30,000 jobs will be lost in the construction sector in the next two to three years, according to Ulster Bank.

In an economic analysis the bank says it believes a slowdown in the building sector will add to unemployment. It is forecasting that as a result the jobless rate could reach 5% by the end of next year.

The bank says that despite a feeling that 'the economy is going down the tubes', the opposite is the case, and it expects strong economic growth this year and next.

Ulster Bank also predicts that the euro could hit $1.40 or higher against the US dollar in the short-term. But the bank says it expects the US currency to recover over the coming months.

The report expects one more interest rate rise from the European Central Bank, most likely in September, leaving rates at a peak of 4.25%. The bank says UK rates have already peaked at 5.75% following July's increase.