{"id":530692,"date":"2026-07-03T07:12:19","date_gmt":"2026-07-03T07:12:19","guid":{"rendered":"https:\/\/www.newsbeep.com\/ie\/530692\/"},"modified":"2026-07-03T07:12:19","modified_gmt":"2026-07-03T07:12:19","slug":"irish-economy-contracts-by-7-1-in-first-quarter-as-export-surge-unwinds-the-irish-times","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ie\/530692\/","title":{"rendered":"Irish economy contracts by 7.1% in first quarter as export surge unwinds \u2013 The Irish Times"},"content":{"rendered":"

The Irish economy contracted by 7.1 per cent in the first three months of 2026 as the front-loading of exports linked to US tariffs<\/a> unwound.<\/p>\n

This compares with a preliminary estimate of a 12 per cent contraction \u2013 in gross domestic product (GDP) terms \u2013 published by last month.<\/p>\n

The volatile numbers come on the back of a surge in exports last year as pharma firms here rushed to stockpile product in the US ahead of Donald Trump\u2019s tariffs.<\/p>\n

The Central Statistics Office\u2019s (CSO) latest national accounts<\/a> indicated, however, that the domestic economy as measured by modified domestic demand (MDD) continued to grow in the first quarter, expanding by 0.3 per cent. <\/p>\n

T\u00e1naiste and Minister for Finance Simon Harris said the figures confirmed that \u201cmomentum continued into the first quarter\u201d.<\/p>\n

Harris said the recent agreement between the US and Iran to solidify their ceasefire and re-open the Strait of Hormuz meant the Government\u2019s more severe growth shock scenario was \u201creceding.\u201d<\/p>\n

\u201cGeopolitical events in the first half of this year underline the importance of continuing to build up our resilience to future shocks and tackle longer-term structural challenges, including by accelerating the transition away from fossil fuel imports,\u201d he said. <\/p>\n

Half-year exchequer numbers due on Friday will give an indication of the Government\u2019s fiscal position as budget negotiations heat up.<\/p>\n

Government tax revenues to the end of May amounted to almost \u20ac39 billion, up by 6 per cent.<\/p>\n

The latest CSO figures indicated the Irish economy grew by 8 per cent in GDP terms last year and MDD by 4.7 per cent, a better measure of underlying activity.<\/p>\n

The strong performance last year was driven by a surge in exports with goods exports jumping by 15.4 per cent.<\/p>\n

Domestic activity was also boosted by a 2.6 per cent increase in consumer spending aided by the growth in real wages.<\/p>\n

[\u00a0Trump rekindles his global trade war with 100% tariff threat on European countriesOpens in new window<\/a>\u00a0]<\/p>\n

The globalised industry sector, which includes the State\u2019s pharma sector, expanded by 11.9 per cent last year while the information and communication sector grew by 14.8 per cent.<\/p>\n

Overall, the multinational-dominated sector expanded by 14.5 per cent in 2025, the CSO said, noting that this accounted for 50.4 per cent of \u201ctotal value added in the economy\u201d.<\/p>\n

\"\"The 9 per cent VAT rate has been welcomed by restaurants but does the hospitality sector actually need it?<\/p>\n

There were also higher levels of economic activity for most domestically focused sectors including a 7.2 per cent expansion for the construction sector amid a pickup in homebuilding.<\/p>\n

Real estate activities increased by 4.9 per cent while the traditional agriculture, forestry and fishing sector grew by 3.6 per cent. <\/p>\n

The only domestic dominated sector not to post growth was the financial and insurance sector which was flat in the year.<\/p>\n

On the expenditure side, personal spending on goods and services, a key metric, rose by 2.6 per cent in 2025, while Government spending on goods and services increased by 3.2 per cent in the year. <\/p>\n

Export growth of 7.5 per cent was recorded while imports grew by 9.6 per cent which meant net exports went up by 2.2 per cent. <\/p>\n

Capital investment increased by 31.5 per cent reflecting what the CSO said was higher levels of investment in intangible assets.<\/p>\n","protected":false},"excerpt":{"rendered":"The Irish economy contracted by 7.1 per cent in the first three months of 2026 as the front-loading…\n","protected":false},"author":2,"featured_media":530693,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[72,61,60],"class_list":["post-530692","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-business","tag-ie","tag-ireland"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/530692","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=530692"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/530692\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/530693"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=530692"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=530692"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=530692"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}