Irish economy returns to growth in first quarter

The Irish economy returned to growth in the first three months of 2024, according to new figures from the Central Statistics Office.

According to its provisional data, Gross Domestic Product (GDP) rose by 0.9% in the first quarter of the year when compared to the same period of 2023.

That breaks four consecutive quarters of falling GDP.

Modified Domestic Demand, which strips out the impact of multinationals, rose by 1.4% in the first three months of the year, according to the CSO.

GDP in the period was boosted by a 3.4% rise in the information and communications sector.

However the industrial sector recorded a decline of 6.5%, while construction was down 4.9%.

Distribution, transport, hotels and restaurants – which has a sizeable impact on the domestic economy – saw growth of 0.9%.

Meanwhile personal consumption was up 0.6% in the three month period.

The CSO data also shows a 7.3% pick up in Irish exports – led by the growth in the ICT sector.

Imports, meanwhile, were down 6.3%.

“While GDP was up in the first quarter, I recognise that GDP continued to fall on an annual basis at the start of this year,” said Minister for Finance Michael McGrath.

“As is widely acknowledged, GDP is not a useful measure in assessing the living standards of domestic residents, given the outsized role the multinational sector plays in our economy.

“The annual decline reflects the volatile nature of multinational production, which can swing significantly from one quarter to another,” he added.

In terms of the domestic economy, Minister McGrath said he is encouraged to see that Modified Domestic Demand – what he described as his preferred metric – grew strongly in the first quarter of this year.

“Importantly, consumer spending meaningfully contributed to this growth, increasing by 0.6% over the quarter,” he said,

“Clearly this a reflection of the continued strength of the labour market, with almost three quarters of the working age population now in work.

“Additionally, the significant easing in inflation over recent months has come as welcome relief for households and businesses alike,” he added.