The economy's growth rate is on course to surpass last year's figure of 9.8 per cent, according to new data. Figures released yesterday also show personal spending and a continuing export boom are fuelling the growth.

The latest data, published by the Central Statistics Office (CSO), are based on returns for the first quarter of 2000 and show the economy's performance will easily exceed official expectations this year.

Despite earlier predictions of a slowdown, this was the third consecutive three-monthly period of double digit growth.

The data show that Gross Domestic Product rose by 11.7 per cent between March 1999 and March 2000 compared with growth rates of 10.5 per cent and 12.1 per cent in the last two quarters in 1999. Gross National Product (GNP), which excludes repatriated multinational profits, grew by 8.8 per cent.

Most areas of the economy contributed to the strong growth. On the back of strong retail sales, personal consumption recorded its highest figure to date 9.6 per cent. Investment was up 16.6 per cent after falling sharply in the three months to December 1999 as firms reinvested after getting through Y2K.

Exports are also up strongly, contributing £2.4 billion to the total GDP figure of £15.6 billion.

"The domestic economy alone is very strong and is getting another kick from the export boom and as a result growth this year is likely to be 13 per cent," Dr Dan McLaughlin, chief economist at ABN Amro, noted.

He added that growth would have been 13.5 per cent in the last quarter if £240 million had not been discounted as a technical adjustment by the CSO.

In overall terms, the volume of output of industry increased by 6.8 per cent, distribution, transport and communications grew by 20 per cent and the volume of output of the other services sectors was up 9.7 per cent. In contrast, the volume of agriculture in the first three months was only up 2.5 per cent.

According to Mr Alan McQuaid, economist at Bloxham Stockbrokers, the economy will eventually begin to cool down as its capacity to respond to more demand becomes more limited.

"Upward pressure on prices and wages, which is already evident, will eventually slow the economy's growth rate to more sustainable levels through competitiveness losses," he said.

He added, however, that these had been avoided so far through continuing productivity growth and the euro's decline.