Staff teams from the European Commission and European Central Bank (ECB) visited Ireland to carry out the second post-programme surveillance (PPS) mission from 17 to 21 November. This was coordinated with the IMF’s second post-programme monitoring (PPM) mission. The European Stability Mechanism also participated in the meetings on aspects related to its Early Warning System.
According to the statement issued at the end of the visit: “The economic situation has continued to improve in Ireland since the end of the EU/IMF-financial assistance programme, with the recovery broadening. Economic growth strongly picked up in the first half of 2014, with the national accounts having reconciled with the previous positive flow of high-frequency indicators, particularly in the labor market. While exports rebounded markedly in the first half of this year, there is still some uncertainty as to whether this strength is sustainable. The broadening of the recovery is being reflected in both the confirmation of a gradual strengthening in private consumption and the expansion of investment. The recent flow of high frequency data bodes well for economic activity in the second half of this year. In the housing market, rising demand and the low level of new construction have pushed up prices rapidly, especially in Dublin. Recently, the Central Bank of Ireland proposed to introduce macro-prudential measures regulating mortgage lending. Overall, real GDP growth of 4.6% and 3.6% is projected for 2014 and 2015 respectively. The main downside risks to the short-term outlook are linked to a weakening in economic momentum in the euro area and the sustainability of high export growth.”