There will be continued strong growth in the real economy between this year and 2027, according to forecasts by Davy, despite global uncertainty.
At the same time, though, the stockbroker has downgraded its forecast for housing completions this year.
Ireland’s gross national income – a measure which excludes multinational activity – expanded by 4.8% last year, according to the Central Statistics Office.
Davy predicts growth of 4.4% this year, with the economy continuing to be “driven by continued strong fundamentals”.
“Labour demand remains robust, especially in high-skill sectors of the economy,” said Davy chief economist Kevin Timoney. “Last week, IDA Ireland showed higher job creation via foreign direct investment in H1 2025.
“Meanwhile, labour supply has been boosted by increased inward migration and rising labour-force participation.”
Davy predicts continued growth in consumer spending, Government consumption and employment in the coming years – with inflation set to remain under 2%.
That, it says, will help to maintain momentum in the real economy – with predicted gross national income growth of 4.2% in 2026 and 4.7% in 2027.
This, along with continued Exchequer surpluses, will see Government debt as a percentage of national income fall below 60% next year – reaching 57% by 2027.
Meanwhile Davy has downgraded its forecast for housing completions – from 42,000 to 37,500. However this remains a more optimistic forecast than those made by the likes of the Central Bank and ESRI.
It also expects recent changes to housing policy to boost output in the years ahead – predicting 43,000 completions in 2026 and 50,000 in 2027.
Article Source – Real economy to continue to grow this year despite global uncertainty – Davy – RTE