{ "title": "IMF Executive Board Concludes 2026 Article IV Consultation with Ireland", "publication": "IMF News, June 29, 2026", "sourceUrl": "https://www.imf.org/en/news/articles/2026/06/29/pr26225-ireland-imf-executive-board-concludes-2026-article-iv-consultation", "canonical": "https://www.imf.org/en/news/articles/2026/06/29/pr26225-ireland-imf-executive-board-concludes-2026-article-iv-consultation", "overlayPath": "/en/news/articles/2026/06/29/pr26225-ireland-imf-executive-board-concludes-2026-article-iv-consultation/index.md", "summary": "The Irish economy has remained resilient in the face of consecutive external shocks.", "publishDate": "2026-06-29", "sections": [ { "heading": "Overview and recent performance", "content": "- The Irish economy \"has remained resilient in the face of consecutive external shocks.\"\n- Modified Gross National Income is estimated to have grown by about 4 percent in 2025.\n- Real GDP (non-seasonally adjusted) growth:\n - 2022: 7.5\n - 2023: -2.5\n - 2024: 2.6\n - 2025: 12.3\n - 2026: -0.8\n - 2027: 3.7\n - 2028: 2.9\n - 2029: 2.4\n - 2030: 2.3\n- Drivers in 2025: robust consumption and investment, and strong exports dominated by foreign multinational enterprises (MNEs).\n- Headline inflation remained close to 2 percent in 2025 but has accelerated recently due to higher energy prices.\n- Employment growth slowed and the labor market has become less tight.\n- The general government balance remained in a sizeable surplus in 2025, supported by continued strong corporate income tax receipts from MNEs." }, { "heading": "Outlook and projections", "content": "- Growth is projected to slow but remain healthy amid trade and geopolitical tensions and elevated global uncertainty.\n- Modified domestic demand growth is projected to moderate from almost 5 percent in 2025 to about 2½ percent in 2026–27.\n- Projections for inflation and output:\n - Headline inflation is projected to rise to about 3½ percent in 2026 and return to 2 percent around 2028.\n- Sectoral outlook:\n - Private consumption expected to slow due to weaker employment and real income growth.\n - Modified investment projected to normalize from the high 2025 level and be supported by continued construction activity.\n - Export growth expected to slow significantly in 2026 and the current account surplus to moderate over the medium term.\n- Ireland’s external position is preliminarily assessed to be moderately stronger than the level implied by medium-term fundamentals and desirable policies." }, { "heading": "Risks and vulnerabilities", "content": "- Downside risks to growth and upside risks to inflation.\n- Substantial external risks stem from the war in the Middle East, contingent on its intensity and duration.\n- Continued reliance on MNEs is a key vulnerability.\n- Rising geoeconomic fragmentation and elevated policy uncertainty could lead to reorganization of supply chains and shifts in trade and capital flows detrimental to Ireland’s globally integrated economy.\n- Rapidly evolving AI landscape poses novel risks, including threats to cyber security.\n- Domestic risks: persistent supply-side constraints could weigh on productivity." }, { "heading": "Fiscal policy guidance", "content": "- Fiscal policy should achieve a broadly neutral stance while scaling up public investment efficiently.\n- Rationale:\n - Economy operating at full capacity and upside inflation risks; fiscal policy should avoid injecting unnecessary demand stimulus.\n - A broadly neutral stance would help build buffers for future shocks and spending needs from aging and the green transition.\n- Automatic stabilizers should be allowed to operate fully if downside risks materialize.\n- Any discretionary fiscal support should be temporary, targeted, preserve price signals, and be accommodated within a broadly neutral fiscal stance, except in a severe downside scenario.\n- Staff welcomes the authorities’ commitment to accelerating public investment; effective implementation will be key.\n- Current expenditure needs close management, including stronger controls to minimize overruns." }, { "heading": "Tax policy and fiscal framework recommendations", "content": "- Broadening the tax base and strengthening the national fiscal framework would reduce vulnerability to the highly concentrated CIT and help prepare Ireland for long-term challenges.\n- Specific revenue recommendations:\n - Increase revenues from PIT, VAT, and local property taxes to provide more sustainable revenue sources for permanent spending commitments.\n - Channel more excess CIT revenues into the two savings funds.\n- Governance recommendation:\n - With no fiscal anchor at present, the MTFSP should guide annual budgets and act as a binding mechanism on spending ceilings over the medium term." }, { "heading": "Financial stability and non-bank sector", "content": "- Systemic risks have risen, warranting ongoing vigilance to safeguard financial stability.\n- The financial system has proven resilient to external shocks, but vulnerabilities exist in segments of Ireland’s large and complex non-bank sector related to leverage and liquidity mismatches.\n- Supervisory focus:\n - Asset quality should remain a key supervisory focus for banks.\n - Macroprudential settings are appropriate; the CBI should continue to review and adjust them as macro-financial conditions develop.\n - Operational resilience: evolving risks from digitalization and cybersecurity require continued focus.\n- Strengthening regulation and supervision of non-banks:\n - The CBI should maintain its leadership role in developing a macroprudential framework for non-banks.\n - Continue monitoring implementation of macroprudential measures for Irish property funds and GBP-denominated liability-driven investment funds.\n - Ongoing efforts with ESMA and other regulators to improve data availability and quality, enhance risk assessment, and develop system-wide stress tests are welcome." }, { "heading": "Structural reforms and strategic priorities", "content": "- Priorities: address housing shortages, enhance energy security, and prepare for the AI transformation.\n- Housing policy actions:\n - Achieving new housing targets will require streamlining the complex planning and judicial review process, increasing urban density, boosting construction productivity, and crowding in private capital.\n- Energy policy actions:\n - Upgrade the electricity grid, strengthen integration with the EU energy market, and harness renewables to bolster energy security and deliver a cost-effective green transition.\n- AI and labor market:\n - Realize AI-related productivity gains while ensuring adjustment does not undermine inclusive growth.\n - Policies needed to help workers adapt and acquire new skills, enhance labor mobility, and foster innovation to leverage Ireland’s abundant talent." }, { "heading": "EU Single Market and international integration", "content": "- The Irish economy would benefit significantly from deepening the EU Single Market.\n- The SIU can facilitate the redirection of savings into productive investments; Ireland’s financial sector, a global leader in asset management, is positioned to lead the transition.\n- The proposed 28th corporate regime, if designed and implemented well, could enable Irish firms to operate more efficiently in the Single Market and bring economies of scale.\n- Advancing new EU trade agreements would allow Irish firms to diversify supply chains and capture efficiency gains from trade." }, { "heading": "Selected economic indicators (highlights)", "content": "- Real GNI (growth rate):\n - 2022: 3.3\n - 2023: 5.7\n - 2024: 4.8\n - 2025: 4.0\n - 2026: 2.0\n - 2027: 2.7\n - 2028: (not listed in growth series for GNI)\n- Modified domestic demand (percentage change) 5/:\n - 2022: 8.4\n - 2023: 6.2\n - 2024: 4.9\n - 2025: (almost) 5 (described in text)\n- Inflation (HICP):\n - 2022: 8.1\n - 2023: 5.2\n - 2024: 2.1\n- Employment (% changes of level, ILO definition):\n - 2022: 6.9\n - 2023: 1.1\n- Unemployment rate (percent):\n - 2022: 4.3\n - 2023: 5.1\n- Public finance (percent of GDP) — Revenue:\n - 2022: 22.3\n - 2023: 23.6\n - 2024: 26.5\n - 2025: 22.7\n - 2026: 23.5\n - 2027: 23.4\n - 2028: 24.0\n - 2029: 24.3\n- General government gross debt (percent of GNI):\n - 2022: 83.9\n - 2023: 75.2\n - 2024: 67.1\n - 2025: 62.2\n - 2026: 59.2\n - 2027: 55.8\n - 2028: 53.4\n - 2029: 51.5\n - 2030: 49.6\n - 2031: 48.4\n- Trade balance (goods) (percent of GDP):\n - 2022: 39.4\n - 2023: 29.9\n - 2024: 31.2\n - 2025: 36.1\n- Current account balance (percent of GDP):\n - 2022: 8.8\n - 2023: 7.0\n - 2024: 16.2\n - 2025: 8.2\n - 2026: 7.8\n - 2027: 7.6\n - 2028: 7.2\n - 2029: 7.1\n- Gross external debt (excl. IFSC) (percent of GDP):\n - 2022: 187.7\n - 2023: 175.7\n - 2024: 154.2\n - 2025: 130.8\n - 2026: 125.5\n - 2027: 114.2\n - 2028: 105.6\n - 2029: 98.3\n - 2030: 91.8\n - 2031: 85.9\n- Nominal GDP (€ billions):\n - 2022: 520.7\n - 2023: 524.7\n - 2024: 562.8\n - 2025: 638.7\n - 2026: 645.2\n - 2027: 685.1\n - 2028: 715.6\n - 2029: 745.1\n - 2030: 775.4\n - 2031: 807.6\n- Nominal GNI (€ billions):\n - 2022: 266.7\n - 2023: 291.4\n - 2024: 321.1\n - 2025: 337.3\n - 2026: 350.5\n - 2027: 368.3\n - 2028: 383.4\n - 2029: 399.2\n - 2030: 415.5\n - 2031: 432.9\n\nSources cited in the report: CSO, DoF, Eurostat, and IMF staff estimates and projections.\n\nItalic: IMF Communications Department, Press Release No. 26/225; Executive Board concluded the 2026 Article IV Consultation with Ireland on a lapse-of-time basis.\n\n---\n\n\n References\n\n- Ireland and the IMF\n- IMF Policy Advice -- A Factsheet\n- Press Releases\n- PRESS CENTER\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2026/06/29/pr26225-ireland-imf-executive-board-concludes-2026-article-iv-consultation" } ], "bullets": [ "[Markdown version](/en/news/articles/2026/06/29/pr26225-ireland-imf-executive-board-concludes-2026-article-iv-consultation/index.md)", "[Structured JSON version](/en/news/articles/2026/06/29/pr26225-ireland-imf-executive-board-concludes-2026-article-iv-consultation/index.json)", "[Bundle manifest](/en/news/articles/2026/06/29/pr26225-ireland-imf-executive-board-concludes-2026-article-iv-consultation/bundle-manifest.json)", "Published: June 29, 2026", "The Irish economy \"has remained resilient in the face of consecutive external shocks.\"", "Modified Gross National Income is estimated to have grown by about 4 percent in 2025.", "Real GDP (non-seasonally adjusted) growth:", "Drivers in 2025: robust consumption and investment, and strong exports dominated by foreign multinational enterprises (MNEs).", "Headline inflation remained close to 2 percent in 2025 but has accelerated recently due to higher energy prices.", "Employment growth slowed and the labor market has become less tight.", "The general government balance remained in a sizeable surplus in 2025, supported by continued strong corporate income tax receipts from MNEs.", "Growth is projected to slow but remain healthy amid trade and geopolitical tensions and elevated global uncertainty.", "Modified domestic demand growth is projected to moderate from almost 5 percent in 2025 to about 2½ percent in 2026–27.", "Projections for inflation and output:", "Sectoral outlook:", "Ireland’s external position is preliminarily assessed to be moderately stronger than the level implied by medium-term fundamentals and desirable policies.", "Downside risks to growth and upside risks to inflation.", "Substantial external risks stem from the war in the Middle East, contingent on its intensity and duration.", "Continued reliance on MNEs is a key vulnerability.", "Rising geoeconomic fragmentation and elevated policy uncertainty could lead to reorganization of supply chains and shifts in trade and capital flows detrimental to Ireland’s globally integrated economy.", "Rapidly evolving AI landscape poses novel risks, including threats to cyber security.", "Domestic risks: persistent supply-side constraints could weigh on productivity.", "Fiscal policy should achieve a broadly neutral stance while scaling up public investment efficiently.", "Rationale:", "Automatic stabilizers should be allowed to operate fully if downside risks materialize.", "Any discretionary fiscal support should be temporary, targeted, preserve price signals, and be accommodated within a broadly neutral fiscal stance, except in a severe downside scenario.", "Staff welcomes the authorities’ commitment to accelerating public investment; effective implementation will be key.", "Current expenditure needs close management, including stronger controls to minimize overruns.", "Broadening the tax base and strengthening the national fiscal framework would reduce vulnerability to the highly concentrated CIT and help prepare Ireland for long-term challenges.", "Specific revenue recommendations:", "Governance recommendation:", "Systemic risks have risen, warranting ongoing vigilance to safeguard financial stability.", "The financial system has proven resilient to external shocks, but vulnerabilities exist in segments of Ireland’s large and complex non-bank sector related to leverage and liquidity mismatches.", "Supervisory focus:", "Strengthening regulation and supervision of non-banks:", "Priorities: address housing shortages, enhance energy security, and prepare for the AI transformation.", "Housing policy actions:", "Energy policy actions:", "AI and labor market:", "The Irish economy would benefit significantly from deepening the EU Single Market.", "The SIU can facilitate the redirection of savings into productive investments; Ireland’s financial sector, a global leader in asset management, is positioned to lead the transition.", "The proposed 28th corporate regime, if designed and implemented well, could enable Irish firms to operate more efficiently in the Single Market and bring economies of scale.", "Advancing new EU trade agreements would allow Irish firms to diversify supply chains and capture efficiency gains from trade.", "Real GNI* (growth rate):", "Modified domestic demand (percentage change) 5/:", "Inflation (HICP):", "Employment (% changes of level, ILO definition):", "Unemployment rate (percent):", "Public finance (percent of GDP) — Revenue:", "General government gross debt (percent of GNI*):", "Trade balance (goods) (percent of GDP):", "Current account balance (percent of GDP):", "Gross external debt (excl. IFSC) (percent of GDP):", "Nominal GDP (€ billions):", "Nominal GNI* (€ billions):", "[Ireland and the IMF](http://www.imf.org/external/country/IRL/index.htm)", "[IMF Policy Advice -- A Factsheet](https://www.imf.org/en/about/factsheets/imf-surveillance)", "[Press Releases](https://www.imf.org/en/news/searchnews)", "[PRESS CENTER](http://presscenter.imf.org/)", "[https://www.imf.org/en/home](https://www.imf.org/en/home)" ], "alternates": { "markdown": "/en/news/articles/2026/06/29/pr26225-ireland-imf-executive-board-concludes-2026-article-iv-consultation/index.md", "json": "/en/news/articles/2026/06/29/pr26225-ireland-imf-executive-board-concludes-2026-article-iv-consultation/index.json", "bundleManifest": "/en/news/articles/2026/06/29/pr26225-ireland-imf-executive-board-concludes-2026-article-iv-consultation/bundle-manifest.json" }, "generatedAtUtc": "2026-09-26T04:46:40.442Z" }