Irish Economy and Budget Watch / / /Emergency Budget Announced for April 7th

Reasonably good news on the employment level with the publication of the Quarterly National Survey.

A few headlines:

Jobs growth of 2.6% in the first quarter.

10 months into the credit crunch and 10% growth in financial services employment.

16% of workforce now from abroad.

Unemployment rises to 4.8% from 4.6%.

Full report here.

Industrial production fell back markedly last month, according to indices published by the CSO today.

Some economic news hitting the newswires today:

Inflation rises from 3.3% to 3.7%

Retail sales value up 0.1%

Another big economic release today:

Building jobs down 13.8% in March

youngdan has made several predictions since Christmas that there will be an emergency budget here. Looks like it from the p.ie news

http://www.politics.ie/viewtopic.php?f=161&t=37232

I hope he's wrong on the coming of the Next Great Extinction though

Auditor #9 wrote:

youngdan has made several predictions since Christmas that there will be an emergency budget here. Looks like it from the p.ie news

http://www.politics.ie/viewtopic.php?f=161&t=37232

I hope he's wrong on the coming of the Next Great Extinction though

I don't understand the alarm. We have had years of large governmental surpluses, our National Debt is at the second lowest level of the European Union, other countries have had years of deficits which will worsen this year. The government should keep its cool, maintain capital spending, trim back current spending and borrow to fulfil objectives outlined in the NDP. The NDP is an investment in our nation's future and should remain sacrosanct, as is education.

Ard T, the sense of alarm is not for the national budget, but for people's immediate personal budgets, mortgages, loans, fuel, food and wages.
People are getting very concerned for their own pockets right now, not the exchequer's.

EvotingMachine0197 wrote:

Ard T, the sense of alarm is not for the national budget, but for people's immediate personal budgets, mortgages, loans, fuel, food and wages.
People are getting very concerned for their own pockets right now, not the exchequer's.

People are indeed being squeezed by the twin pressures of loss of economic momentum and a resurgence of inflation. This period should be used to go on an economy drive. Switch your mortgage to a cheaper provider, go for the cheapest petrol/fuel you can find, switch to a cheaper and less fuel-intensive car, buy some things in Aldi/Lidl, get cheaper insurance and spend less on fripperies like shoes and hairdressing.

If people do that, they will see their personal financial fortunes significantly improve and allow them to ride out current difficulties.

The CSO Earnings and Hours worked Report was published for the construction industry today.

Earnings per hour are up 4.4% while hours worked are up 1.9%.

Full report here.

Hibernian to cut 590 jobs over 3 years. Going to India.

http://www.breakingnews.ie/ireland/mhgbqlkfeykf/

EvotingMachine0197 wrote:

Hibernian to cut 590 jobs over 3 years. Going to India.

http://www.breakingnews.ie/ireland/mhgbqlkfeykf/

Indeed. Commiserations to all concerned. 123.ie, Chill.ie and insure.ie are all rapidly-growing new market participants, they'll be able to get jobs with those firms.

A good report from finfacts today on the ESRI report.
http://www.finfacts.ie/irishfinancenews/article_1013998.shtml

Pity this otherwise excellent site is scapegoating the No vote. It is plainly nothing to do with the economic fix we are in.

The External Trade figures were issued today:

Full Report Here.

Exports down 5%.

Imports down 7%.

Trade surplus up.

Curate's egg of a set of figures.

Ard-Taoiseach wrote:

The External Trade figures were issued today:

Full Report Here.

Exports down 5%.

Imports down 7%.

Trade surplus up.

Curate's egg of a set of figures.

With the Dollar as it is, I would have expected these to be somewhat UP. Or at least even.

EvotingMachine0197 wrote:

Ard-Taoiseach wrote:

The External Trade figures were issued today:

Full Report Here.

Exports down 5%.

Imports down 7%.

Trade surplus up.

Curate's egg of a set of figures.

With the Dollar as it is, I would have expected these to be somewhat UP. Or at least even.

You would indeed, though it is encouraging that the Trade Surplus is up which will boost the economy since Exports-Imports adds to National Income.

Car registration figures should be out soon.

Ard-Taoiseach wrote:

...

Car registration figures should be out soon.

I'll take a guess at Down 22%

EvotingMachine0197 wrote:

Ard-Taoiseach wrote:

...

Car registration figures should be out soon.

I'll take a guess at Down 22%

Oh, probably. *weary sigh*

Ard-Taoiseach wrote:

EvotingMachine0197 wrote:

Ard-Taoiseach wrote:

...

Car registration figures should be out soon.

I'll take a guess at Down 22%

Oh, probably. *weary sigh*

But that's a good thing is it not. We are buying far to many new cars in Ireland. It's a huge import which lowers the trade surplus, it's bad for the environment (should be using cars for longer) and provides the exchequer with unsustainable income.

EvotingMachine0197 wrote:

Ard-Taoiseach wrote:

EvotingMachine0197 wrote:

Ard-Taoiseach wrote:

...

Car registration figures should be out soon.

I'll take a guess at Down 22%

Oh, probably. *weary sigh*

But that's a good thing is it not. We are buying far to many new cars in Ireland. It's a huge import which lowers the trade surplus, it's bad for the environment (should be using cars for longer) and provides the exchequer with unsustainable income.

It is indeed. We do need to be moving to new sorts of transport and it does cause Balance of Payments difficulties. It's just that rising car registrations are a feel-good economic statistic.

The figures were released while we were talking. down 39.8%. Ouch!

Ard-Taoiseach wrote:

EvotingMachine0197 wrote:

Ard-Taoiseach wrote:

EvotingMachine0197 wrote:

Ard-Taoiseach wrote:

...

Car registration figures should be out soon.

I'll take a guess at Down 22%

Oh, probably. *weary sigh*

But that's a good thing is it not. We are buying far to many new cars in Ireland. It's a huge import which lowers the trade surplus, it's bad for the environment (should be using cars for longer) and provides the exchequer with unsustainable income.

It is indeed. We do need to be moving to new sorts of transport and it does cause Balance of Payments difficulties. It's just that rising car registrations are a feel-good economic statistic.

The figures were released while we were talking. down 39.8%. Ouch!

Oh Holy mother of Jesus. That's a big one.

EvotingMachine0197 wrote:

Ard-Taoiseach wrote:

EvotingMachine0197 wrote:

Ard-Taoiseach wrote:

EvotingMachine0197 wrote:

Ard-Taoiseach wrote:

...

Car registration figures should be out soon.

I'll take a guess at Down 22%

Oh, probably. *weary sigh*

But that's a good thing is it not. We are buying far to many new cars in Ireland. It's a huge import which lowers the trade surplus, it's bad for the environment (should be using cars for longer) and provides the exchequer with unsustainable income.

It is indeed. We do need to be moving to new sorts of transport and it does cause Balance of Payments difficulties. It's just that rising car registrations are a feel-good economic statistic.

The figures were released while we were talking. down 39.8%. Ouch!

Oh Holy mother of Jesus. That's a big one.

It is indeed. We could still see a rally in car sales after the July changes to the VRT regime. This year is not a normal one for the car market.

Yes, the changes could be having a big impact on that. I read somewhere that there are big reductions in the second hand market. I wonder how all this fits together.

EvotingMachine0197 wrote:

Yes, the changes could be having a big impact on that. I read somewhere that there are big reductions in the second hand market. I wonder how all this fits together.

One thing I've noticed is that there are an awful lot of cars for sale in my area. I think people are making big switches this year. I expect there to be a flurry of activity in the latter half of the year.

I'm nursing my old car along until they invent one that will run on a sail or pedals assisted.

People won't buy when they don't know if they will have a job or not. The indicator I use for the optimum point of a property bubble is when you start to see people driving funky coloured shiny convertibles. They will still be driving the same cars in 5 years time, if the Thatcher era bubble is anything to go by.

Those who can cycle should buy a good bike.

freedomlover has a very heartening analysis of yesterday's trade figures;

freedomlover wrote:

While the media in Ireland and posters on P.ie were reacting to yesterday's ESRI report as if it was Divine Revelation (instead of just a collection of forecasts by second-rate economists with a very poor track record in forecasting), I was digesting some far more significant statistics published yesterday by the CSO. The main ones were the merchandise export and import volumes statistics for Q1 2008. This is what they showed, both on a year-on-year basis and a quarter-on-quarter basis:

year-on-year:

between Q1 2007 and Q1 2008, the volume of merchandise exports was UP 2.3% and that of imports was DOWN 4.5%

quarter-on-quarter:

between Q4 2007 and Q1 2008, the volume of merchandise exports was UP 6.1% and that of imports was DOWN 0.8%

What these figures means is that in both cases net merchandise exports (exports minus imports) were UP by about 7%. The significance of this is that net exports are one of the main components in the calculation of GDP. Each 1% increase in net merchandise exports adds about 0.5% to GDP. This doesn't necessarily mean that GDP will increase by 3.5%, but that the 7% increase in net merchandise exports will cancel out about 3.5% of any fall in GDP resulting from reduced house-building, or whatever.

I don't want to be too technical, but what yesterday's figures mean is that the trend in net merchandise exports for Q1 2008 will have to be totally reversed in the rest of 2008 for ESRI's recession forecast to prove accurate. Obviously, that's a possibility and I wouldn't rule it out, although I'd consider it unlikely. It depends largely on the world economy. But, if the trend in net mercandise exports for Q1 2008 continues for the rest of 2008, then ESRI will be entering the Guinness Book of Records for the worst economic forecast ever made.