Bertie Ahern’s resignation comes as the Irish economy hits rocky times. Falling house prices and the effect on an overexpanded construction sector, as well as the impact of the euro’s record strength on exports, are threatening a significant slowdown in the “Celtic tiger” economy.

The Irish central bank is expected later this week to revise downwards significantly its forecasts for growth this year from the 3 per cent it is currently projecting. That would contrast dramatically with the growth rates of 10 per cent or more seen a decade ago, or even the 5 per cent growth rates seen more recently that earned Ireland plaudits as the one of the best-performing economies in the 15-country eurozone.