Recent economic data shows that a “broad recovery” is currently underway in the Irish economy, thanks to steady increases in total employment, outperformance in underlying tax revenues and buoyant trends in the retail sector.

The data also points to the return of the Irish consumer.

According to the latest Irish Economy Monitor from Investec, the broad nature of the recovery is illustrated by the fact that all three PMIs for Ireland – the manufacturing and services PMIs compiled by Investec and the Ulster Bank construction PMI – have been simultaneously above 50 since September 2013.

While net exports remain a significant driver of growth, the domestic economy has also seen a meaningful upturn this year.

"The Irish consumer has made a significant comeback, with retail sales posting 11 successive months of annual growth in both value and volume terms, led by so-called 'big ticket' items (some 89,915 new private cars were licensed in the first 10 months of 2014, which is more than the annual total for any year since 2008)," said Philip O Sullivan, chief economist with Investec Ireland, noting that the Consumer Confidence index hit its highest level in September since January 2007, and the unemployment rate continues to fall.

Investec is now forecasting GDP growth of 4.8 per cent, 3.5 per cent and 2.9 per cent over the 2014 –2016 period ( itwas 2.5 per cent,;2.8 per cent and 2.5 per cent respectively), and it has also upgraded its estimates for consumption (from 1.4 per cent to 1.7 per cent) on the back of positive retail trends.

However, Mr O’Sullivan added a cautionary note when he said that the Irish economy is not without its risks.

“While household debt and unemployment are moving in the right direction, they remain very high in absolute terms. In addition, while many Irish firms will benefit from favourable FX moves and the (not unrelated) economic expansion in the US and UK, the weaker prospects for the Eurozone are unhelpful (although with slightly more than half of all residential mortgages on tracker rates linked to the ECB base rate, this is providing some respite to many Irish households).”