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Ireland’s economic growth rate remained surprisingly upbeat in the fourth quarter of 2016, as the country retained its spot as the fastest-growing economy in the EU.
The economy expanded by 2.5 per cent in the quarter, a slowdown from the third quarter’s 4 per cent growth rate but still more than twice as fast as the 1 per cent predicted by economists.
Ireland’s economy has been among the best-performing in Europe since the end of the financial crisis, and the strong fourth quarter brought the country’s annual growth rate to 5.2 per cent, with growth across every sector of the economy.
That’s something of a dip from 2015′s massive 26.3 per cent growth rate, but that year’s remarkable numbers were skewed by corporate inversions that inflated the country’s stock of capital assets.
Ireland’s appeal to foreign investors has made its GDP figure an unreliable measure of the economy’s true performance, and the country’s statistics office is working on a series of new domestically-focused indicators.
Personal consumption of goods and services, which accounts for around half of the headline figure and is used as one proxy for domestic activity, also rose by a healthy 3 per cent.
However, Ireland’s central bank has been pessimistic about maintaining growth in the year ahead, repeatedly cutting its growth forecasts since the UK’s Brexit vote. In its last quarterly update in January, the CBI predicted the economy would expand by a (by Ireland’s standards) weak 3.3 per cent this year, as an expected slowdown in Britain damages prospects for Irish exporters.