ESRI lowers Irish growth forecast for 2016 amid economic uncertainty

Ireland is becoming less dependant on exports, but the report says a potential Brexit is the main threat to Ireland's recovery

Forecast economic growth in Ireland has been reduced slightly, according to the latest report from the Economic and Social Research Institute (ESRI).

It predicts GDP will grow by 4.6% this year - down slightly on the 4.8% previously predicted.

This is partially due to fears over Thursday's vote on EU membership in the UK.

Unemployment is expected to fall to 7.6% by the end of this year - and 6.5% by the end of 2017.

Economic growth is now being driven more by domestic activity, rather than foreign trade, according to the research.

Speaking about the report, author Kieran McQuinn said, "We still expect the Irish economy to register very significant growth in 2016 and 2017, particularly when compared with other European economies.

"However, there are some indications that the slowdown in global trade, coupled with the uncertainty surrounding the outcome of the Brexit referendum in the UK, is having an adverse impact on the traded sector of the Irish economy. These are the main downside risks to the Irish economy at present."

Mr McQuinn told Newstalk that Ireland's recovery is becoming more reliant on improved domestic demand and increases in consumption: