Ireland’s economy grew seven per cent in the year to the end of September, data showed yesterday, leaving it on course to be the fastest-growing in Europe for the second year running.
The economy expanded by 5.2 per cent last year, its best performance since 2007, before a property crash plunged it into recession and triggered a fiscal and banking crisis. That growth has accelerated as exports benefit from the weak euro and years of pent-up demand boost the domestic economy.
“Today’s figures are once again very strong and provide further confirmation that economic recovery is now firmly embedded,” Finance Minister Michael Noonan said in a statement. “The figures also confirm that the increase in economic activity is broadly based.”
Ireland’s economy is outperforming the rest of the eurozone at least partly because of how far it fell. Peak to trough, Irish gross domestic product dropped 11 per cent during the crisis, more than double the decline in the rest of the EU, said Austin Hughes, KBC’s chief economist.
It is also getting a boost from a weak currency compared with key trading partners Britain and the US. The end of years of austerity mandated by the EU and the International Monetary Fund mean its budget added around 1.3 per cent into GDP after taking 1.25 per cent out of it last year.
Spending Minister Brendan Howlin said growth in the economy might exceed seven per cent for 2015 as a whole, better than the official forecast of 6.2 per cent announced in October.
Gross domestic product grew 1.4 per cent in the third quarter from 1.9 per cent in the second, the Central Statistics Office data showed.
Exports rose 2.2 per cent quarter-on-quarter and personal consumption was up 0.7 per cent, while Investment spending increased by 4.9 per cent.
Gross national product, seen by some economists as a more accurate indicator of the state of the economy because it strips out multinationals’ earnings, was up 3.2 per cent from the same quarter in 2014.
Inflation remains weak, however, with the consumer price index (CPI) falling by 0.3 per cent in November compared to October, data released yesterday showed.