The third quarter GDP/GNP figures (link below) were published by the CSO this morning. They confirm that GDP growth in 2007 will be around 6% in 2007. For the first three quarters of 2007 GDP was up by 6.0% compared with the first three quarters of 2006. For the first three quarters of 2007 GNP was up by 5.9% compared with the first three quarters of 2006. In the fourth quarter of 2006 GDP actually fell, so the upshot is that, even if there is no further growth in GDP in the fourth quarter of 2007, GDP growth for 2007 as a whole will be just over 6%. If there is even modest growth of about 1% in GDP in the fourth quarter of 2007, then GDP growth for 2007 as a whole will be about 6.25%. GNP growth is a bit more volatile and unpredictable than GDP growth because it partly depends on the timing of multi-national companies payments abroad. But, in the first three quarters of 2007, GNP growth and GDP growth are virtually identical, 6.0% for GDP, 5.9% for GNP. The final year figures for 2007 are very likely to be of similar magnitude.
It is nice to end the year's posting on P.ie on a note of triumph. I've consistently predicted that GDP growth for 2007 would be 5.8%. A couple of weeks ago, on one of Ard-Taoiseach's threads (can't remember which), I revised my forecast up to the range 6.0% to 6.5%. Its now clear I was spot on. Contrast this with forecasters like ESRI, Davy, even Brian Cowen. In the past couple of months ESRI and Davy revised their 2007 GDP forecasts down to 4.4% and 4.0% respectively, while Brian Cowen revised his 2007 GDP forecast down to 4.75%. At the time I posted that they were wrong to revise their forecasts down and predicted that GDP growth in 2006 would be around 6.0%, exactly as predicted at the start of the year. They'll all have to scramble to revise their 2007 forecasts back up again in the next few weeks. Of particular note is that GNP in the third quarter of 2007 was 6.0% up on the third quarter of 2006. How often have we been told by the doommonger posters on P.ie that 2007 would be a year of two halves, that year-on-year growth in the second half of 2007 would collapse to 1% (which they describe as 'skirting with recession')? Not in their wildest nightmares did they envisage year-on-year GNP growth in the second half of 2007 being 6%.
ESRI are worthy of particular attention. Its a standard ESRI ploy over the years that, when CSO figures are published that show ESRI's forecast for the current year to be hopelessly wrong, they try to distract attention from that fact by publishing their forecast for the following year on the same day. Thus, for the past few months ESRI have been forecasting 4.4% GDP growth in 2007. The CSO figures out today show that their 2007 forecast will be wrong by about 2%. But, hey, never mind, publish the 2008 forecast to coincide with the CSO figures and hope that nobody will notice that the 2007 forecast is hopelessly wrong.
http://www.cso.ie/releasespublications/ ... nt/qna.pdf