Economists now believe the public finances could move into deficit by more than €1 billion this year.

Following Exchequer data for the first four months of the year, some economists have revised their deficit forecasts sharply upward. But others are more optimistic, believing the public finances will break even at year-end or report a slight deficit at worst.

Where the brokers stand on the public finances, and on whether the official forecast of a €170 million surplus will be met, depends largely on their view of the economy as a whole.

Davy Stockbrokers, which has been among the most bearish forecasters of the Irish economy, has revised its figures upwards following Thursday's data showing an Exchequer deficit of €112.7 million compared with a surplus of €1.18 billion last year. The broker now expects a deficit of €1-€1.5 billion this year compared with its previous forecast of €750 million.

Mr Alan McQuaid at Bloxham is another of the pessimists and forecasts a shortfall of at least €1 billion. "It's hard to see revenue picking up that strongly," he said.

IIB economist Mr Austin Hughes foresees a significant deficit of around €750 million, though he too believes it could be €1 billion.

But NCB is looking for a small deficit of less than €100 million and will wait until mid-year before considering its figures again.

It believes the 11 per cent drop in income tax in the year to date was due to timing factors relating to Budget tax cuts and should unwind as the year goes on.