The Irish economy, measured by gross domestic product (GDP), is estimated to have expanded by 1.2 per cent in the three months through June, marking a second straight quarter of growth after a decline in multinational exports delivered four quarters of contraction last year.
The Central Statistics Office (CSO) said that growth in the most recent quarter, compared to the first three months of the year, was mainly driven by an increase in activity in the industrial sector.
However, GDP is estimated to have decreased by 1.4 per cent on a year-on-year basis, according to the preliminary read for the quarter.
The CSO cautioned that the initial figures may be subject to revision before its next quarterly national accounts report, using a wider range of data sources, is released in early September.
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“GDP is estimated to have expanded by 1.2 per cent in April, May and June 2024 in volume terms compared with the first quarter of 2024. This was driven by an increase in the multinational denominated sector of industry,” said Enda Behan, a statistician in the CSO’s national accounts data collection and quality division.
“After combining this preliminary read for the second quarter of 2024 with the estimate for the fist quarter from the quarterly national accounts, GDP is estimated to have contracted in the first half of 2024 by 3.1 per cent compared with the first half of 2023.”
GDP fell by 3.2 per cent last year as a result of big contraction in the multinational pharmaceuticals and technology sector, according to Department of Finance figures. However, modified domestic demand, which gives a better read of the domestic economy, expanded by 0.5 per cent in 2024, according to the department.
The department forecasts that Irish GDP will rebound by 2.6 per cent this year and expand by 3.9 per cent in 2025, according to its latest estimates, issued in April. It sees modified domestic demand growing 1.9 per cent in 2024 and a further 2.3 per cent next year.
The official Government GDP forecasts are more optimistic than more recent estimates elsewhere. The Central Bank sees the widest measure of economic activity growing by 1.8 per cent this year, with Bank of Ireland recently downgraded its full-year estimate to 1 per cent from 1.5 per cent, previously, even as it sees the underlying domestic economy growing at a healthy pace.
The International Monetary Fund (IMF) said earlier this month that the global economy is set for modest growth over the next two years amid cooling activity in the US, a bottoming-out in Europe and stronger consumption and exports for China.
The IMF warned that momentum in the fight against inflation is slowing, which could further delay an easing of interest rates.
The IMF kept its 2024 global GDP growth forecast unchanged from April at 3.2 per cent and raised its 2025 forecast by 0.1 percentage point to 3.3 per cent.
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