Davy's upgrades Irish growth forecast to 5%

This would make it the fastest growing EU economy for the fourth year in a row...

Davy's upgrades Irish growth forecast to 5%

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Davy has upgraded its growth forecast for the Irish economy, it expects it to grow by 5% this year. That is up from a previous forecast of 3.7% growth.

"That would likely make Ireland Europe’s fastest growing economy again this year," the report added. It also expects Ireland's GDP to expand by 3.8% in 2018.

These predictions are based on a scenario where the UK leaves the EU with a transitional deal - which would avoid the introduction of WTO trade tariffs.

Commenting on the introduction of tariffs it adds that, "clearly that risk remains, with very real consequences for agriculture, for SMEs and indigenous manufacturers, most likely in 2019."

The report also increases the expected rate of house price inflation, rising from 8% to 10%.

It believes that export growth will increase from 2.4% in 2016 to 4.5% in 2017 and 4.4% in 2018.

According to the report, unemployment is expected to fall to 5.3% - and Government spending is forecast to increase by 2.6%.

Their data suggest that consumer spending will accelerate by 3.4% in 2017.