Ireland's gross domestic product (GDP) grew 12.2% to €124.3bn last year, according to estimates from the Central Statistics Office (CSO).

GDP growth exceeded the government's forecast of 10% at the time of Budget 2023 while slowing somewhat from 13.6% in 2021, although Goodbody Stockbrokers said it would make Ireland the fastest-growing economy in Europe.

Overall, the Irish economy has grown 33% since the 2019, the final year before the Covid-19 pandemic.

The economy grew by 3.5% on a quarterly basis and 13.5% year-on-year during the final three months of the year, driven mainly by expansion in the manufacturing sector.

This is the first time the CSO has published 'flash' quarterly estimates on GDP 30 days after the end of the quarter, and the data will be incorporated into Eurostat's flash GDP estimates for the EU and the euro zone.

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"The publication of more timely data is a welcome development and serves as a useful and early complement to the more detailed release due out in early March," said Minister for Finance Michael McGrath.

"While some volatility is likely between this flash release and the detailed release in March, it is broadly in line with what my Department projected for 2022 at Budget time and reflects the continued strength of the multinational sector in Ireland last year.

"Other metrics mirror this growth, such as very robust goods exports and strong corporation tax receipts last year."

Minister McGrath added that the "robust" growth in GDP did not reflect the progression of the domestic economy as the figures were greatly influenced by the outsized multinational sector.

Modified domestic demand figures, which measure growth in the economy excluding multinational companies, will be published in early March, and McGrath expects they will paint "a more modest picture".

“Internationally, incoming data suggest that the downturn may not be as severe as previously assumed. The IMF signalled last week that it will make a modest upward revision to its growth forecasts for this year, which are due out tomorrow, owing to reduced price pressures, increased fiscal supports and the re-opening of the Chinese economy following its zero-Covid policy," McGrath continued.

“While set to remain relatively high over 2023, inflation in Ireland appears to have peaked sooner than had been expected, driven by an easing in energy prices, some of which has already been reflected at the pump.

"I am encouraged that despite numerous headwinds, our labour market continues to perform strongly with close to record-low unemployment rate of just 4.3% in December."

(Pic: Getty Images)