2026.07.0210:23:20UTC+00Ireland’s Economy Contracts Less than Initially Thought

Ireland’s economy contracted by 7.0% in the first quarter of 2026, deepening the revised 3.6% decline recorded in the previous quarter. The highly globalized Industry sector shrank by 12.0% compared with Q4 2025, while the Information & Communication sector fell by 2.0%. Overall, activity in the multinational-dominated sectors declined by 7.5%.

In contrast, underlying domestic activity remained relatively resilient. Modified Domestic Demand (MDD) increased by 0.3%, supported by a 0.8% rise in personal consumption. Domestically focused sectors edged up by 0.1%, with the Professional, Administrative & Support sector expanding by 1.0%.

External trade dynamics weakened. Exports dropped by 8.4% while imports rose by 2.4%, resulting in a 37.4% fall in net exports. Capital investment, however, jumped by 27.0%, largely reflecting higher stock values, and government consumption expenditure grew by 0.3%.

Gross National Product (GNP), which excludes the profits of multinationals, increased by 6.8%. This was mainly driven by a 48.4% reduction in factor income outflows.