Image: Alamy Stock Photo Image: Alamy Stock Photo CAREFUL MANAGEMENT OF Ireland’s public finances will be required over the coming months as the economy deals with spillover from the war in Ukraine and soaring prices, the Central Bank of Ireland has said.
The public finances are also “well-positioned to address the most immediate needs arising from the conflict in Ukraine, including the necessary humanitarian response for those displaced by the war”, the report highlights. The Central Bank has now shaved 2.7 percentage points off its expectations for Irish headline growth this year with Gross Domestic Product expected to expand by 6.1% in 2022.
But inflation is also now expected to remain higher for longer than expected with the war in Ukraine and Western sanctions pushing up global energy prices. “Cost of living increases from higher food and energy prices tend to be larger for lower-income, older and rural households, who typically spend more of their weekly outgoings on these products,” the report highlights.