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IMF cuts Irish growth forecast for this year

The International Monetary Fund has revised downwards its projection for economic growth in Ireland this year.

The organisation is now predicting that the Irish economy as measured by Gross Domestic Product (GDP) will expand by just 1.5% in 2024.

That is down from a forecast of GDP growth of 3.3% which it published in October.

However, the IMF expects growth will pick up further in 2025, with GDP projected to expand by 2.5%.

The fund also expects that inflation in Ireland will fall more than previously expected this year, averaging out at 2.4% across 2024 before settling back to 2% next year.

Employment will also remain robust, the IMF thinks, with unemployment forecast to remain low at 4.4% this year and only rising marginally to 4.5% in 2025.

The figures are contained in the IMF’s latest World Economic Outlook, which was published as the Spring Meeting of the organisation and the World Bank gets underway in Washington DC.

The outlook estimates that the global economy will grow by 3.2% this year, the same rate as 2023 and an increase of 0.3 percentage points on what it predicted in October.

“Nevertheless, the projection for global growth in 2024 and 2025 is below the historical (2000–19) annual average of 3.8%, reflecting restrictive monetary policies and withdrawal of fiscal support, as well as low underlying productivity growth,” the report says.

“Advanced economies are expected to see growth rise slightly, with the increase mainly reflecting a recovery in the euro area from low growth in 2023, whereas emerging market and developing economies are expected to experience stable growth through 2024 and 2025, with regional differences,” it added.

The IMF also predicts that the same steady pace of expansion will continue into 2025.

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