Ireland's economy is performing well with unemployment at an historic low level, the Central Bank has declared. 

In its quarterly bulletin, the bank predicted headline inflation is expected to rise to 2.2% this year, before declining to 2.1% next year, and easing further to 1.4% in 2027. 

Households’ will also see real incomes continue to rise, supported by further growth in employment.

However, it has warned the outlook will be challenging due to global events.

Donald Trump and Micheál Martin. Image: Newstalk.

Robert Kelly, Director of Economics and Statistics at the Central Bank, added that tariffs and trade with the US could mean a “seismic shift” in the global economy.

“The challenge for us now is, the detail is what’s really important in terms of quantifying those impacts,” he said. 

“But they’re not occurring in a vacuum; what we’ve seen now is the inevitable uncertainty rising [in the] economy. 

“That has real impacts; it can cause households to delay large purchases and businesses to defer investment.” 

Tom Clarke bridge spanning the River Liffey. Picture by: Alamy.com.

Meanwhile in New York, Tánaiste Simon Harris said he believes that US companies have done well from their investments in Ireland. 

He added that tariffs would harm people on both sides of the Atlantic. 

“Many US companies have decided to locate in Ireland because it has been very good for them,” he said. 

“We have been delighted with that investment, we’ve been delighted with that job creation - but they’ve also done very well. 

“Regardless of the views of the US administration, I believe that so many US companies are going to want to do business in Europe and are going to require a European base. 

“I think Ireland is well placed to continue to provide a stable business environment and home for those companies.” 

Last week, US President Trump said that he did not “want to do anything to hurt Ireland - but we do want fairness."

The following day he threatened to impose 200% tariffs on alcohol imports from Ireland and other EU countries.

Main image: Taoiseach Micheál Martin with US President Donald Trump in the Oval Office. Picture by: Tasos Katopodis / Government of Ireland