Confidence in economy grows due to vaccine rollout

Confidence in the Irish economy grew by 15 points in the last quarter, driven mainly by the rollout of the Covid-19 vaccine, according to a survey by financial professionals

The Association of Chartered Certified Accountants (ACCA)’s latest global economic conditions survey, published with the Institute of Management Accountants (IMA), found that the relaxation of public health restrictions also played a significant role.

It said the vaccine rollout, which despite starting slowly at the beginning of the year gathered momentum in the second quarter, continued to have a positive impact on the economic outlook.

It also pointed to strong export demand which is set to fuel economic growth in the second half of the year.

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The survey was conducted among an expert panel of accounting professionals, and it found economic confidence in Ireland was among the highest in western Europe, with the Irish index being 4.3 points higher than the western European average.

However, despite the optimism, the report warns that rising cases of the Delta variant in Ireland and western Europe are a cause for concern in the remainder of 2021, but that early evidence of the vaccine impact is at present alleviating many concerns.

Caitríona Allis, head of ACCA Ireland, said: “There is a strong correlation between the speed of the vaccine rollout and the economic outlook for Ireland.

“In the first quarter, we saw a dramatic rebound from 2020 as the vaccine programme began and gathered pace, which has led to another notable rise in optimism in the second quarter.

“The current challenges that there are to the reopening are significant and they could potentially have an adverse impact on the economic outlook especially with the PUP [pandemic unemployment payment] and the Wage Subsidy Scheme due to end shortly.

“However, with strong consumer sentiment, growing levels of trade and with the resilience we have seen throughout the pandemic, we are well positioned to ride out this storm.”