CSO figures expected to show acceleration in growth in first quarter

Figures from the Central Statistics Office are expected to confirm a further acceleration in economic growth in the first quarter of the year.

New quarterly national accounts, delayed due to the incorporation of 15 years of aircraft leasing data, will be published next Thursday, about one month later than usual.

Despite large revisions to trade in goods data, the balance of payments and the international investment position, economists say such changes will not affect the underlying level of gross domestic product (GDP).

This is because adjustments to international investment figures will quash the impact of increased imports when incorporating aircraft leasing data. “We would argue that this is nothing more than a cosmetic change, with little or no relevance to the current position of the Irish economy,” said Dermot O’Leary, chief economist at Goodbody stockbrokers.

At the same time, he and other economists expect a spur to first quarter growth from a rise in consumer spending and investment increases.

Mr O’Leary said, “Investment was the fastest growing expenditure component in 2014, rising by 11 per cent. We expect an even faster rate of growth in 2015, with construction to take over the baton from business investment.”

Alan McQuaid, chief economist at Merrion Capital, said he expected quarter-on-quarter GDP growth of 3 per cent in the first three months of the year and 5 per cent growth compared with 2014.

The revision follows changes in EU rules compelling member states to change how they account for the trade in aircraft. They are now obliged to record trade in aircraft when economic ownership is transferred between an entity in the State and an entity in another country, regardless of where the aircraft is registered. Such changes are significant as roughly half of the world’s fleet is leased from firms in Ireland and net book value equates to 60 per cent of Irish GDP. “While in this case there is expected to be limited effect on GDP or GNP, it will impact on Ireland’s current account surplus (the excess of exports over imports), which is an important indicator of whether the economy is on a sustainable growth path,” Mr McQuaid said.

“As things currently stand we are looking for a current account surplus of €1.2 billion in the first quarter, up from a positive balance of €960 million in the same period last year.”