Employers group Ibec has upgraded its outlook for growth for this year to 7.1% of GDP on the back of stronger than expected consumer activity in the economy. 

It comes in the aftermath of the Government's third quarter figures last week which indicated that annual growth was running at around 7%. 

But Ibec warns that the current high growth rates are temporary and we cannot rely on a number of factors; like ultra low interest rates, low inflation and low oil prices; forever.
 
It said it would like to see the Government ringfence corporate tax receipts to invest in infrastructure. 

The group also points out that public and private investment is needed in housing, roads, public transport, education and health to avoid pressure points choking the positive economic momentum. 

Ibec has predicted that unemployment is set to fall below 8% by the end of next year as the strong jobs recovery continues.

But it noted the worrying trend towards divergence in employment growth between Dublin and the rest of the country.

Fergal O'Brien, Ibec's director of policy and chief economist, said that it is vital we don't squander the opportunities that we are now presented with - plummeting debt levels and staggering growth.

"The economy remains in a sweet spot with favourable exchange rates, low interest rates and weak oil prices benefiting us more than any other European country," Mr O'Brien said. 

He said the return of moderate wage growth and strong increases in employment also means the domestic economy will account for the majority of total growth this year and next. 

"However, many of the factors driving the strong growth are external and temporary. Maintaining competitiveness is key to sustaining the positive momentum into the future," he added.