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Dublin growth slows as start of 2024 likely to be ‘challenging’

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Economic activity in Dublin continues to grow, but at a slower pace, with concerns being raised that “weakening business activity” could lead to a “challenging” start to the new year for the capital, the latest economic monitor shows.

The monitor, conducted by Grant Thornton and published on behalf of the four Dublin local authorities, shows that Dublin’s Purchasing Managers’ Index (PMI) continued to show growth between July and September but at a slower rate.

A PMI reading above 50 shows growth in the economy, with the latest reading for the city coming in at 53.5.

This rate of expansion was weaker than that recorded in the months April to June but still remained significantly stronger than the equivalent rate across the rest of the country at 50.5.

In Dublin, the construction sector continued to be the strongest performer, with a sector PMI of 57.3, which shows strong ongoing levels of activity. Slowing growth was recorded in the services sector, at 52.6, while manufacturing saw an improvement in activity levels with a reading of 49.4, up markedly from 46.6 during the previous three months.

Andrew Webb, chief economist with Grant Thornton, said the year is ending with the economy showing “hard-won momentum”, particularly in the labour market.

Grant Thornton chief economist Andrew Webb warned that ‘weakening growth in business activity indicators and consumer spending measures suggest that the start of 2024 could be challenging’.

However, he warned that “weakening growth in business activity indicators and consumer spending measures suggest that the start of 2024 could be challenging”.

Data from MasterCard shows that the value of retail spending by consumers in Dublin expanded between July and September. This is the 10th consecutive quarter where there has been an increase but at a marginally slower pace than in previous quarters.

According to MasterCard, overall spending increased by 0.9% compared to the previous quarter, with entertainment spending increasing by 11.9%. Dublin tourism spending grew by 2.5% quarter-on-quarter.

The unemployment rate in the capital stands at 5.1% with a decline of 16,400 jobs compared to the previous three months. The areas with the highest reductions were finance, insurance, and real estate, down 5,100, and wholesale and retail, down 4,300.

Foreign direct investment into the Dublin economy declined by 33% compared to the second quarter of the year and is down 63% compared to the same period last year.

Overall, approximately $367m (€340.4m) was invested into the capital over the three-month period.

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