Today, after markets close, rating agency Moody’s, is scheduled to release an Irish update. Ireland has already grabbed the positive attentions of rating agencies in 2022. On January 14th DBRS, upgraded Ireland’s sovereign credit rating by one notch to AA (low) with a stable outlook. Just two weeks later, Fitch upgraded its Irish rating for the first time since 2017. The one notch upgrade returned Ireland to Fitch’s AA rating category for the first time since 2010. In making its decision to upgrade, Fitch cited the continued improvement in Ireland’s tax revenues and the extent of the strong economic recovery from the pandemic shocks. Fitch also highlighted its expectation that Ireland’s debt to GDP and debt to national income will enter a firm downward trajectory, marking a change from its previous projection that these would remain stable at their current level.
Ireland is now rated in the AA or equivalent category by three of the four major global ratings agencies (Standard & Poor, Fitch and DBRS Morningstar). Not for the first time, Moody’s is lagging with regard to its Irish rating. At A2 (positive), the Moody’s rating is clearly an outlier. Ireland has demonstrated a strong track record of dealing with external shocks. Both Brexit and Covid were expected to derail the Irish economy but following the initial setback the Irish economy demonstrated strong resilience to exit both those periods in a better financial position than anticipated. The Irish economy is expected to handle the current geopolitical crisis in a similar manner. Given that the Irish fiscal and macro situation has further improved since January, which was reflected in the large positive fiscal revisions contained in the Department of Finance’s Spring statement versus what was anticipated back in the Budget in October 2021. Hence, we are optimistic that the time is now right for Moody’s first Irish upgrade since September 2017.
The seasonally adjusted Monthly Unemployment Rate for April 2022 was 4.8%, down from a revised rate of 5.1% in March 2022 and down from 7.5% in April 2021. In April 2022, the seasonally adjusted Monthly Unemployment Rate was 4.9% for males and 4.7% for females. Breaking the results down by broad age group, the seasonally adjusted Monthly Unemployment Rate for those aged 15 to 24 years was 5.6%, while it was 4.7% for those aged 25 to 74 years.
