Covid-19: Ireland's economy to recover ‘by end of 2021’

Ireland's Central Bank expects the country's domestic economy to return to pre-pandemic levels of output by the end of the year.

It expects domestic demand to grow by 5.5% this year and by 7.1% in 2022.

It said: '"While the strength of the recovery was expected, it has happened more quickly than forecast."

All remaining public health restrictions in Ireland are planned to be lifted by 22 October.

More than 90% of the country's adult population have been vaccinated against Covid-19.

The bank says that while uncertainty remains high, it assumes that the vaccination programme will allow the pandemic to be managed "without the need for significant public health restrictions of the type seen in spring 2020 and early 2021".

However, it cautioned that some sectors of the economy would take longer to recover, particularly tourism and hospitality.

The bank also said that some inflationary pressures were evident due to a surge in demand, supply bottlenecks and some constraints in the labour market.

It assesses that the main drivers of the higher inflation outlook are "considered temporary".

However, it cautioned that "promoting sustainable growth in Irish living standards requires careful management of domestic economic policy as it moves away from a focus on pandemic-related measures".