The Central Bank says the Irish fiscal strategy is 'on track' with the economy forecast to grow by 2% this year. That is down slightly by 0.1 of a percent on the prediction of last quarter.
The Central Bank says growth is being driven by employment growth, inward investment by companies and steady improvements among our main trading partners.
It says the stronger job figures are boosting household income as well as consumer confidence - with personal consumption forecast to grow by just over 1% this year.
In a statement, the Bank says "Continued employment growth is likely to support household incomes and consumer confidence and, given this prospect, modest positive growth in consumer spending is projected for 2014".
"Investment spending has gathered strength, which is forecast to be maintained this year. Together with the outlook for consumer spending, this points to some increase in domestic demand in 2014, though this is likely to be modest given that many headwinds to recovery still remain".
The Bank says the clearest sign of recovery is provided by labour market data, "which indicate that employment has grown strongly over the last five quarters".
It says that while the recovery in employment was initially confined to part-time jobs, recent quarters have seen steady growth in 'broadly based' full-time employment.
It adds that signs of improvement are also visible in investment data, business and consumer survey measures and in more positive retail spending.
Terry Quinn from the Economic Analysis Divisions says there are risks ahead, but the recovery is looking more secure.
