Prospects for the Irish economy remain positive with Gross National Product expected to grow by six per cent this year, according to the Central Bank's annual report published today.
Speaking at the publication of the bank's report today, the Governor of the Central Bank, Mr Maurice O'Connell said a growth level of six per cent remains "highly possible" if outside factors such as the US economy do not worsen.
He said that recent signs of a recovery in the flagging US economy were "reasonably encouraging". But he added that Ireland's current growth rate was still beyond what the Central Bank regards as sustainable in the medium term.
Mr O'Connell reiterated the Central Bank's forecast of an annual inflation rate of 4.5 per cent for the year, still well ahead of the ECB's inflation target of two per cent.
He noted that private sector credit, which has been a repeated concern of the bank in recent years, slowed to below 20 per cent last year but he said the bank would continue to monitor the situation.
The Governor announced that the Central Bank made a surplus of euro 520 million last year as a result of the continuing valuation gap between the euro and the US dollar. Nearly 90 per cent of this surplus is passed on the exchequer.
Mr O'Connell made particular mention of preparations for the introduction of euro banknotes and coins. The changeover to the European single currency will be on a much greater scale than decimalisation in 1970. The bank has a three-year production programme which includes printing 150 million notes and 950 million coins in the new currency.
The bank does not envisage a wave of price rises due to rounding up during the changeover as consumer awareness is already high with many items already priced in both currencies.