Stockbroker Davy has lowered its forecasts for Irish economic growth this year.
In a report, it said it now expected gross domestic product (GDP) to rise by 1.6% this year, down from a previous 1.9% forecast. It says GNP - which excludes profits from multi-national companies - will grow by 0.6%.
Davy says export growth will slow from 10% last year to 6.8% this year, in line with a slowdown in world demand. It also believes consumer spending will drop by 1.4% this year.
It says growth will continue to be affected by the sharp drop in investment, particularly in the construction sector, though it expects a 'modest recovery' in other areas of business investment. Davy also says the unemployment rate will stay above 14% this year and next year.
But the stockbroker's report warns that the outcome of the Central Bank's stress tests on the banks, and European negotiations on the wider euro zone debt crisis, could have a big impact on the economic outlook.
