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Monday 19 March 2018

Economy grew by 1.5%

Figures show the economy grew by 1.5% between July and September
Figures show the economy grew by 1.5% between July and September

The economy grew by about 1.5% towards the end of the summer, official figures have shown.

The Central Statistics Office said that the value of the entire economy and the domestic economy increased by similar rates between July and September compared with the previous quarter.

The report on the national accounts said preliminary estimates showed gross domestic product - which includes the multinational sector - grew by 1.5% while gross national product, which relates purely to Irish businesses, grew by 1.6%.

The CSO found industry, including building and construction grew by 2.2% while distribution, transport, software and communication increased by 2.1%.

However, public administration and defence decreased by 1% and agriculture, forestry and fishing declined by 2.9% between the second and third quarters of the year.

Trade union Siptu said it was not impossible that the economy would meet Government targets for the year.

Economist Marie Sherlock said: "Signs of a turnaround in construction activity during the summer months along with a pick-up in consumer spending saw domestic demand expand by 2.4% in the third quarter.

"Unfortunately, this was partially offset by a contraction in net exports which was due to setbacks in the pharmaceutical, electronics and food production sectors."

Ms Sherlock noted strong performance of tourism and transport but warned overall figures are below last year.

"In order to realise the Government's target of 0.2% growth for the year, a real GDP increase of 1% in the final quarter will be needed. This isn't impossible given that export demand is likely to rebound. However, there is ongoing concern about renewed weakness in consumer demand," she said.

Business lobby group Ibec said the figures show a solid recovery is under way.

The group's chief economist Fergal O'Brien said: "The investment sector, particularly construction activity, is expanding quite strongly, albeit from a very low base. Consumer spending is likely to further strengthen as the 60,000 more people at work start to spend their additional wages in the domestic economy."

Ibec warned, however, that exports remain a drag on the economy.

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