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Irish economic growth expected to exceed forecasts

Ireland’s economy will grow more this year than previously expected, the Central Bank has said.

Latest official figures predict the value of all goods and services in the country – known as gross domestic product (GDP) – will rise by 5.1% during 2016.

That is 0.3% higher than the previous forecast.

Some experts say a truer indication of the economy’s health is gross national product (GNP) – which excludes global firms who take their profits out of the State.

That figure is also expected to grow by 4.7% over the coming year.

The Central Bank is also predicting continued economic growth next year – but not as sharp as this year, or last year’s remarkable jump.

However, it also warned that Ireland remains vulnerable to shocks from overseas.

A particular threat comes from the uncertainty caused by Britain’s in/out referendum in June on whether it will continue its membership of the European Union.

In its latest quarterly bulletin, the Central Bank’s chief economist Gabriel Fagan said: “The growth outlook is relatively favourable and domestic economic momentum is strong, although there are some risks to the outlook from external factors.

“The main driver of growth will be the continuing recovery in employment and incomes, although following its very strong growth in recent years, employment growth is projected to gradually moderate over the forecast horizon.”

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The Central Bank said more jobs was probably the most important factor in the economic bounce-back.

But it also pointed to better wages in recent years as well as lower energy prices giving Irish people generally more money to spend.

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