The Economic and Social Research Institute has predicted the country's GDP will grow by 4.8% this year, following growth in the Irish economy of 7.8% last year.

In its latest economic outlook, the ESRI said that strong domestic consumption and investment, along with improving international conditions, are the main factors underpinning this growth.

According to the ESRI,  GDP will grow by 3.9% in 2019 based on a technical assumption that a European Economic Agreement (EEA) is in place between the UK and the EU.

Research from the ESRI earlier this week showed that a hard Brexit could push up consumer prices by 2% to 3%, adding between €890 and €1,360 to the annual spend of the average Irish household.

It said the estimated increase in consumer prices would arise from the imposition of tariff and non-tariff trade barriers as a result of Brexit to imports from the UK.

The cost increase would also fall disproportionately on the poorest households, as they tend to spend more of their money on the type of goods that would be hit with the highest tariffs, notably food.

In today's economic update, the ESRI said it is expecting the country's unemployment rate to decline to 5.4% in 2018 and 4.5% in 2019. Unemployment averaged 6.7% last year.

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The ESRI also said that it expects increased tax revenue will lead to budget surpluses in 2018 and 2019.

But the economic think-tank said it remains difficult to produce accurate estimates of sustainable economic growth based on the current set of national accounts.

It noted that estimates of overall output growth as well as major components of growth such as investment and trade are influenced by large transactions of a select number of firms.

"It is important to continue developing new approaches that allow for estimates of growth that are more representative of activity in the real economy," the think-tank said.

It added that this is especially pressing at present as the economy is growing at such a robust rate.

"Policymakers need to be able to accurately gauge when the economy is likely to encounter capacity constraints," it added.

Research Professor with the ESRI, Kieran McQuinn, said the country's tax base has become more concentrated and comes mostly from income and corporation taxes.

Kieran McQuinn said there could be sustainability problems in the future, if the number of firms contributing to the corporation tax remains low.

He said a major capital investment programme would require a large number of workers, adding that attracting the labour could be difficult.