The Irish Economy: Some End of Year Statistics

Économiste Monétaire · 23-12-2010 4:37pm #1

These are some stats that I haven't seen posted on boards recently (i.e., figures beyond headline Q/Q real GDP growth and the unemployment rate), but some people might be interested in them.

As the national debt is not indexed to inflation, it's useful to look at nominal GDP growth. The graph below shows the contribution to seasonally adjusted nominal GDP since Q1 2007 (NX = Net Exports):

You can't do this for real GDP due to the non-additivity of superlative indices.

Exchequer revenue from Jan-Nov for the last four years, in 2010 Euro terms for comparison:

Annual growth of M2 and M3:

Annual inflation:

It's often useful to look at which sub-indices are contributing most to the overall CPI figure:

01 Food and Non-Alcoholic Beverages;
02 Alcoholic Beverages and Tobacco;
03 Clothing and Footwear;
04 Housing, Water, Electricity, Gas and Other Fuels;
05 Furnishings, Household Equipment and Routine Household Maintenance;
06 Health;
07 Transport;
08 Communications;
09 Recreation and Culture;
10 Education;
11 Restaurants and Hotels; and
12 Miscellaneous Goods and Services.

Below is a graph of yearly housing completions since 1981, with 2010 being up to and including November of this year:

Industrial production:

Retail Sales:

Below is the headline residential mortgage debt figure, adjusted for securitisations (not accounting for securitisations masks approx. €35 billion of debt):

The ESRI/PTSB House Price Index:

Irish Central Bank lending in Eurosystem refinancing operations:

What would John Taylor* do?

*This is the 'famous' Taylor rule for setting monetary policy,

[latex] \displaystyle i = r + \beta_{\pi}(\pi - \pi^{*}) + \beta_{y} (y - y_{p}) [/latex]

where i is the interest rate, r is the equilibrium rate, [latex] \displaystyle \pi [/latex] is the inflation rate, [latex] \displaystyle \pi^{*} [/latex] is the target on inflation, y is (the log of) real GDP, and y_p is the log of 'potential output'.

Potential GDP is proxied by using a HP filter, and coefficients of 1.5 and 0.5 are used for [latex] \displaystyle \beta_{\pi} [/latex] and [latex] \displaystyle \beta_{y} [/latex], respectively.