“I welcome today’s data which confirm robust growth in the domestic economy last year. Inflation eased considerably throughout 2024, which boosted real incomes. As a result, consumer spending grew solidly by just under 3 per cent, supported by strong growth in employment. Overall, Modified Domestic Demand (MDD) increased by 1.8 per cent in 2024, while GNI* increased by almost 5 per cent.

“Today’s data also confirm strong growth in the first quarter of this year with Modified Domestic Demand growing by 2 per cent on a quarterly basis (or almost 3 per cent on an annual basis). This performance is consistent with the continued momentum in the labour market, with a record number of people in employment in the first quarter of the year.

“I note that GDP increased by 7.4 per cent on a quarterly basis, which was driven by a strong increase in goods exports reflecting, in part, the ‘front-loading’ of exports in anticipation of the imposition of tariffs by the US administration. As I have stressed previously, this activity is likely to moderate somewhat over the remainder of this year.

“Looking ahead, we are facing into a period of considerable uncertainty in the global economic environment relating to the introduction of tariffs and the rise in geo-fragmentation. Given the globally integrated nature of the Irish economy, this uncertainty will act as a headwind to Irish growth.

“From a policy perspective, we need to continue to calibrate economic and budgetary policies that recognise the changed external backdrop. In particular, this means focusing on boosting the competitiveness of the economy and continuing to build up our fiscal buffers. The government will set out its updated strategy in the Summer Economic Statement later this month.“

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Notes