There is a high level of confidence among the business community as it faces into 2002, according to the latest Irish Times/Ulster Bank business survey.

The quarterly report found 63 per cent of firms expected their businesses to grow this year, with only 2 per cent predicting a decline - while 34 per cent saw no change.

The survey also confirmed that the euro's introduction had gone smoothly in the business sector, with only 11 per cent reporting "some slight problems" to date.

More than 97 per cent of those interviewed said they had no problems in relation to systems, technology, training, cash management or pricing in euro.

"This outcome has surpassed all expectations," Mr Pat McArdle, head of economic research at Ulster Bank, said.

"The introduction of the euro was well prepared, reflecting the Herculean efforts of those in the front line - notably retailers and banks - the adaptability of the public and the extensive information campaigns undertaken."

The survey of 100 Irish companies, carried out by MRBI, was conducted last week. It finds that 57 per cent of companies believe ordinary shoppers will lose out due to rounding-up of prices by retailers, while 36 per cent say they will not.

However, 93 per cent of those surveyed said there had been no change in their prices as a result of the euro changeover, while 5 per cent said prices had fallen. Just 2 per cent admitted they had risen, although this was higher in the distribution and retail sectors, where 4 per cent reported price increases. Asked what impact the focus on price comparisons across the euro zone would have on prices, 80 per cent of firms expected no change.

Six per cent of firms said it would push prices up while 9 per cent saw it forcing prices down - although this was higher in the Dublin area, at 13 per cent.

Asked about their expectations for the economy, a significant 95 per cent of businesses said they expected job numbers either to increase or stay the same this year, while 42 per cent expect prospects for business in general to improve - compared with 18 per cent who foresee a decline.

"Though the range of forecasts for economic activity next year is still unusually wide, people are gradually becoming more optimistic as signs of a turnaround appear in the US," Mr McArdle said.

Looking at the property market, 47 per cent said they expected property prices to stabilise, 33 per cent predict a further fall in prices and 17 per cent see an upturn.

Mr McArdle said he believed respondents were unduly pessimistic on the outlook for property prices. "While up-to-date surveys show that house prices fell by 5 per cent in 2001, the recent Budget measures should bring about a gradual improvement throughout this year, causing prices to rise by 5 per cent," Mr McArdle said.

On interest rates, 48 per cent expect them to stabilise, 32 per cent see further reductions while 17 per cent expect rates to rise.

Asked about the future of the euro, 86 per cent of all companies, and 76 per cent of larger firms, expect it to strengthen this year.

Finally, the vast majority of Irish firms surveyed expect sterling to join the euro. Just 3 per cent believe Britain will never adopt the single currency, while 96 per cent expect it will.

Of this number, 60 per cent expect Britain will join within three years, while only 8 per cent believe they will join more than five years from now.