Modest growth in third quarter gives rise to modest optimism
THE economy grew very slowly in the third quarter of the year but there are signs that consumer spending and exports are on the mend, the Central Statistics Office said today.
Gross domestic product increased 0.2pc from the second quarter, when it rose a revised 0.4pc, the CSO said. The statistics agency had previously estimated that the economy didn’t grow in the second quarter.
The economy has posted the first gain over a three-quarter period since 2008. While that is good news, the CSO’s statisticians noted that many technical issues helped the economy to post growth.
The International Monetary Fund said last night that Ireland faces “significant risks” to its growth outlook from weakening in the economies of the country’s trading partners and a fifth year of austerity.
“The worry is obviously you can’t see consumer spending holding up much given the austerity in the budget,” said Alan McQuaid, an economist at Merrion Capital in Dublin. “Clearly, we are the only country that is growing among the peripherals so that helps in our perception abroad with international investors.”
Exports rose 0.3pc in the third quarter, while imports increased 2.1pc, the CSO said. Consumer spending gained 0.5pc and investment spending climbed 8.5pc - a sign that companies are slowly regaining confidence in the future and beginning to invest.
Gross national product fell 0.4pc in the third quarter from the second quarter but rose 3.7pc from the year earlier period. GNP was flattered by contributions from the some UK companies which have located operations here to escape UK tax rules.