Bernard Durkan (Kildare North, Fine Gael)
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61. To ask the Minister for Finance the extent to which he remains satisfied that all economic indicators remain positive and if so the likely benefit arising therefrom now and in the future; and if he will make a statement on the matter. [5170/15]

Michael Noonan (Limerick City, Fine Gael)
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Following the successful conclusion of the EU-IMF programme, the Irish economy has emerged from the crisis and economic recovery is now well established. The latest available data for 2014 show that GDP growth for the first three quarters of the year is broadly in line with my Department's forecast at Budget time.

According to recent figures published by the European Commission, it expects Ireland to be the fastest growing economy in Europe in 2014 and 2015. Importantly, domestic demand is making a positive contribution to growth for the first time since the crisis began. Consumer spending has been strong in 2014 with retail sales up over 6 per cent compared with 2013. Core sales (excluding motor trades) were up close to 4 per cent in 2014. Investment in building and construction as well as in machinery and equipment spending are on a rising path.

Exports rose by 15.5 per cent in the year to the third quarter of 2014. This was the fastest rate of expansion since 2001. Recovery is perhaps most clearly evident in the labour market with employment having increased in each of the last eight quarters to the third quarter 2014, representing an increase of over 80,000 jobs since the low-point in mid-2012. In line with this, the standardised unemployment rate stood at 10.6 per cent in December, having fallen from a peak of 15.1 per cent in early 2012.

Macroeconomic forecasts for the years 2014 to 2018 were presented by my Department on Budget Day, last October. These forecasts see GDP growth of 4.7 per cent in 2014 and 3.9 per cent this year. This growth is driven by a positive contribution from net exports on the back of growth in Ireland's trading partners. Domestic demand is set to contribute to growth as well, with growing employment and rising household incomes resulting in an increase in private consumption over the period. Over the medium term, GDP growth of about 3½ per cent a year is anticipated.

Notwithstanding the current improvement, risks to the outlook remain. These relate to the low inflation observed in many advanced economies, geo-political tensions as well as the underperformance of the euro area economy.

In terms of the public finances, policy measures implemented by the Government have resulted in a decline in the deficit in recent years. This decline has been in a phased manner, consistent with the dual needs of supporting domestic activity as well as repairing the public finances. All of the interim deficit ceilings under the Excessive Deficit Procedure have been met and Ireland is firmly on track to achieve a deficit of below 3 per cent this year. This has been important in restoring Ireland's credibility in the international markets, and bond yields have fallen substantially since the highs of mid-2011. The debt ratio has peaked and is now on a downward path. After 2015, fiscal policy will be set in line with the requirement to move towards Ireland's medium-term budgetary objective, which is for a balanced budget in structural terms.