Northern Ireland Economy Growth Forecast
Northern Ireland's economy is projected to grow by only 0.7% this year, as elevated energy costs impact both businesses and consumers, according to the consultancy EY.
This forecast aligns with projections from other analysts, including Ulster University, which also anticipate growth below 1% for the year.
EY noted that early-year business surveys indicated expanding private sector activity in Northern Ireland. However, the escalation of the US-Israeli conflict and its effects on Iran have introduced additional cost pressures and uncertainty.
For instance, heating oil prices in Northern Ireland surged by a record 92% in March. Approximately two-thirds of households in Northern Ireland rely on home heating oil for their energy needs.
Rob Heron, managing partner at EY Northern Ireland, stated: "Northern Ireland's economy continues to show resilience, but growth is increasingly constrained by global volatility, impacting costs, confidence and investment decisions."
Republic of Ireland Economy Forecast
EY forecasts that the Republic of Ireland's domestic economy will grow by 2.7% this year, based on a measurement that excludes the distorting effects of multinational corporations.
This growth rate is lower compared to the exceptional growth of nearly 5% expected in 2025.
Dr Loretta O'Sullivan, chief economist at EY Ireland, commented: "Last year saw a very strong performance by the Irish economy, beating all forecasts, and it is only to be expected that this would unwind somewhat in 2026.
"Combined with the impact of the conflict in the Middle East on the global energy market and the world economy, we are projecting more moderate but still decent growth this year, something many of our peer nations will not be expecting."
It is important to note that these forecasts are made amid significant uncertainty. Numerous factors could cause substantial deviations from the assumptions used in economic models.
