Northern Ireland

EC: 'Irish economy will grow faster than others in 2016'

Image copyright PA
Image caption The commission forecasts growth of 4.5% in 2016 and 3.5% in 2017 for the Irish Republic

A new forecast from the European Commission predicts that the Republic of Ireland will continue to have the fastest growing economy in the Eurozone in 2016.

The Commission said GDP growth in 2015 was 6.9%, off the back of improving public finances and sustained employment growth.

Irish GDP figures are distorted by the financial activities of multinational companies and many economists think the real growth rate is probably 3.5% to 4%.

That still makes it one of the the Eurozone's best performing economies.

The commission forecasts growth of 4.5% in 2016 and 3.5% in 2017.

Unemployment is expected to fall to below 8% in 2017.

It has also forecast that inflation will pick up slightly, to 1.4% by 2017, driven primarily by a projected recovery in wages.

The commission said that, while the recovery started in the external sector, domestic demand is now driving GDP growth.

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