Ireland’s economy slid into recession late last year and continued to contract sharply in early this year, new and revised figures showed on Thursday, just months before it is due to exit its EU/IMF bailout programme.
Gross domestic product shrank 0.6 per cent in the first quarter of this year from the previous three months, confounding analysts’ expectations of 0.3 per cent growth - a shock reading that shows the euro zone member is recovering from financial crisis much more slowly than previously thought.
Revised data also showed a quarterly contraction of 0.2 per cent in the fourth quarter of last year, meaning Ireland’s economy has shrunk for three successive quarters and is in its first recession since 2009.
The Irish government is targeting growth of 1.3 per cent this year and while Finance Minister Michael Noonan said he would not tie himself to any particular number when asked if that forecast would have to be revised, he said that other parts of the public finances were holding up better.
“They’re certainly disappointing but it’s one set of statistics,” he said.
“We built the budget on 1.3 (per cent growth) and the tax flows for the first half of the year are consistent with our budgetary targeting. We’ll be slightly ahead of target, we think, for June.”