Ireland’s economy exhibited a blend of growth and volatility across various key indicators in 2023, with signs of stability emerging in early 2024.
Modified Domestic Demand, often used as a proxy for the domestic economy, grew by 2.6% in 2023. This metric provides a clearer picture of the economic health within the country by excluding the distorting effects of multinational enterprises.
GNI*, a key deglobalised measure of national income, saw an impressive growth rate of 5% last year. This figure is crucial as it accounts for income flows associated with multinational corporations and offers a more accurate reflection of the nation’s economic wellbeing.
Consumer spending also demonstrated robust growth, increasing by 4.8% in 2023. This uptick is attributed to the strength of the labour market, indicating that households were more confident in their financial stability and willing to spend more.
In contrast, GDP fell by -5.5% last year, highlighting the inherent volatility within the multinational sectors. However, there was a slight recovery at the beginning of 2024, with GDP increasing by 0.7% in the first quarter. This rebound suggests some stabilization in production activities.
Modified Domestic Demand continued to show resilience in the first quarter of 2024, recording a solid growth of 1%. This sustained growth underlines the ongoing strength and potential of the domestic economy amidst fluctuating global economic conditions.
Overall, while certain sectors face challenges, the steady performance in Modified Domestic Demand and consumer spending signals a promising outlook for Ireland’s domestic economy in the months ahead.
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