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11/07/2008
Broker Expects GDP To Fall By 2.2%
A leading stockbroker firm has turned its previous forecast on its head, suggesting Ireland's gross domestic product (GDP) will see negative growth this year.
In its most pessimistic forecast yet for the Irish economy, stockbrokers Goodbody predicted house prices will fall by a hefty 30%, while reversing its previous forecast of a GDP rise of 1.1% to a huge fall by 2.2%.
The firm believes sharply declining activity in the construction sector and weakening consumer spending will push the economy into a recession.
Their seems to be little agreement, as speculations by each financial institutions fail to match up. Earlier this month, the ESRI forecast a fall in GNP of 0.4%, and now the Department of Finance has revised its target to a rise of 0.5%. Meanwhile, Ulster Bank has said the decline would be 0.3pc and National Irish Bank expects growth of 1%.
"We now expect a contraction of 2.2% in GDP in 2008, down from our previous estimate of plus 1.1%. Falling employment and a further contraction in construction, though, will mean that a recovery in output overall is now not likely until 2010," the stockbrokers warned.
(DW/JM)
In its most pessimistic forecast yet for the Irish economy, stockbrokers Goodbody predicted house prices will fall by a hefty 30%, while reversing its previous forecast of a GDP rise of 1.1% to a huge fall by 2.2%.
The firm believes sharply declining activity in the construction sector and weakening consumer spending will push the economy into a recession.
Their seems to be little agreement, as speculations by each financial institutions fail to match up. Earlier this month, the ESRI forecast a fall in GNP of 0.4%, and now the Department of Finance has revised its target to a rise of 0.5%. Meanwhile, Ulster Bank has said the decline would be 0.3pc and National Irish Bank expects growth of 1%.
"We now expect a contraction of 2.2% in GDP in 2008, down from our previous estimate of plus 1.1%. Falling employment and a further contraction in construction, though, will mean that a recovery in output overall is now not likely until 2010," the stockbrokers warned.
(DW/JM)
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