Chart of the week: Ireland’s economic recovery gathers momentum

Ireland has suffered a wrenching recession and only narrowly averted national bankruptcy thanks to a bailout from international creditors. But now it finally appears to be turning the corner.

GDP grew by 2.7% in the second quarter of 2014. The annual rate of expansion has now reached 5.1%, a figure typical of pre-crisis days. Meanwhile, unemployment has edged down to a five-year low of 11.6%. Ireland now looks set to trim its budget deficit to 4.8% of GDP this year, down from 7.2% in 2013.

Unfortunately, there isn't much life in the domestic economy, as households are still weighed down by debts that total twice the national income, while mortgages arrears have been on the rise. Instead, growth depends on exports. For now, trade is strong.

Try 6 free issues of MoneyWeek today

Get unparalleled financial insight, analysis and expert opinion you can profit from.

Start your trial

Sign up for MoneyWeek’s free twice-daily newsletter.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Sign up

Yet while Ireland's two top trading partners, America and Britain, are growing rapidly, Europe, another key export destination, seems to be slowing. So it looks like there's a long slog to go before the rebound reaches take-off speed.