Ireland's economic recovery is "still strong but it may have lost some momentum" in recent months, the Irish Fiscal Advisory Council will warn today.

High oil and gas prices are stoking inflation and as prices have risen, it has reduced households' spending power.

The council will warn the Budgetary Oversight Committee: "There are major risks to the economy going into this winter, particularly of a shut-off in gas supplies to Europe.

"Covid-19 and Brexit still pose uncertainties. Financial conditions could tighten. And domestically, we could see competitiveness issues and capacity constraints arising from labour shortages, rising wages, and housing costs."

Consumer spending slowed early this year, pulling down domestic demand as the global recovery has been hindered by the sharp rise in energy costs, it will tell the committee.

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As the European Central Bank and other central banks have responded to rising inflation by raising interest rates, it has contributed to a downgrading of growth forecasts in Ireland's trading partners.

The current outlook for oil and gas suggests that prices, while expected to fall eventually, will stay higher for longer than previously thought which will keep the current high rates of inflation, particularly if wages were to respond strongly.