Modified domestic demand points to Ireland’s economy growing, but not by much via IrishTimesBiz
European Commissioner for the Economy Paolo Gentiloni announced the EU's latest growth forecasts on Monday. Photograph: John Thys/Getty ImagesThe latest European Commission economic forecasts are generally seen as being a glass half full, as it were. The threatened recession will be avoided, the commission believes, and inflation has peaked. But across the EU, the cost-of living crisis has taken a bite.
The GDP factor is also helping to put Ireland at the top of the league for expected growth this year, with a forecast expansion of 4.9 per cent compared to an EU average of 0.8 per cent. Official forecasters have predicted that modified domestic demand — a measure which factors out many of the multinational distortions — will rise by 1.2 per cent this year and while this forecast may well be revised upwards, Ireland’s growth is not as far above the average as the top-line GDP figures suggest.
As the commission drily puts it in its section on Ireland, “the performance of multinational corporations could swing growth in either direction”. This is true in the “real” economy, of course, where we wait to see the impact of the tech job cuts; so far, the unemployment rate has remained near historic lows, though many of the cuts may still have to happen.
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