Market Pulse Report Q3 2022

The Irish Economy

The ESRI expects Irish growth to remain strong over 2022, with Modified Domestic Demand (MDD) expected to grow
by 7.5% this year. However, growth is expected to decline in 2023, with inflation forecast to average 8.1% in 2022 and
6.8% in 2023.

Energy Crisis

Although energy prices have increased, in part due to a decline in Russian gas supply, better than expected weather
across Europe, substitution to different energy sources, and a change in both personal and industrial behaviour, has meant the energy crisis has not yet materialised to the extent feared.

Global Economic Trends

Global growth is forecast to slow from 6% in 2021 to 3.2% in 2022 and 2.7% in 2023, as economic activity is experiencing
a sharper than expected slowdown. The IMF expects global inflation to rise from 4.7% in 2021 to 8.8% in 2022 but to decline to 6.5% in 2023 and to 4.1% by 2024.

Rising Prices

Inflation in the Eurozone rose by 9.9% year on year in September, with energy prices remaining the biggest contributor to accelerating prices, rising 40.8%. Core inflation, which excludes volatile factors such as energy, food, alcohol and tobacco, increased year on year by 6%.

British Budget

The markets reacted strongly against a mini budget introduced by the new Conservative government in the United Kingdom, which was expected to increase the national debt by cutting taxes and increasing spending. The pound slumped to a 37 year low against the dollar in trading, forcing the UK government to row back on the budget.

Read more of Q3 2022 in the full report which can be downloaded here.

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