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Pace of public spending risks an economic crisis, Central Bank warns

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3 months ago

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Pace of public spending risks an economic crisis, Central Bank warns

​Message is likely to be hammered home in a pre-budget letter to the Government

Central Bank governor Gabriel Makhlouf. Photo: Steve Humphreys

If Government spending increases continue at the current pace without any new tax measures to counter balance it, ministers risk driving higher inflation, damaging Ireland’s competitiveness and long-term prospects for growth in living standards, the Central Bank of Ireland (CBI) has warned.

The message from the Central Bank’s economists in their second regular quarterly bulletin of this year, echo previous warnings from the Irish Fiscal Advisory Council and are likely to be further hammered home in a pre-budget letter from the Central Bank governor, Gabriel Makhlouf, that is due to be sent to Finance Minister Michael McGrath in the coming weeks.

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