Moody's, one of the world's three main credit ratings agencies, said Ireland's highly volatile economic performance is one of its main concerns about the country's creditworthiness.

The State probably needs more "fiscal and financial buffers" than is the norm for more stable economies to maintain a similar rating, Kathrin Muehlbronner, Moody's lead analyst on Ireland, said in a note following news this week that the country's economy soared by 26 per cent in 2015.

Downgrade

“We caution that the revision to the 2015 gross domestic product growth numbers were heavily distorted by the transactions of a number of multinational entities, which have a limited impact on the domestic economy and the government’s repayment capacity,” said Ms Muehlbronner.

Moody’s said that while it expects the Government to continue to exceed budgetary fiscal targets, “there are emerging spending pressures, particularly in the healthcare sector.”

Moody’s downgraded Ireland’s debt rating at the height of the financial crisis, in 2011, to junk, which is below what it considers investment grade. While the agency has been slower than peers to upgrade Ireland in recent years as its finances improved, it surprised most economists in May by upgrading the State to an A rating.

It was the last among the three main ratings firms to return Ireland to the A-club.