Economists have scaled back their forecasts for the Irish economy after weak trade hindered growth in the first quarter.
GDP is now expected to rise by 5 per cent this year; in last month's survey, economists had predicted economic growth of 5.85 per cent.
Forecasts for GDP growth in 2006 and 2007 were also cut to 5.2 and 5.35 per cent respectively from previous forecasts of six per cent for both years.
Alan McQuaid, chief economist at Bloxham Stockbrokers, said that after disappointing GDP growth of 2.4 per cent in the first three months of the year, Ireland would be hard pressed to hit the 5.1 per cent rate targeted by the government for this year.
"Furthermore, consumer spending could come under pressure in the second half of the year as oil prices continue to soar and media headlines focus in on the possibility of higher interest rates in the not too distant future," he added. He forecast 2005 GDP growth was likely to be closer to 4 per cent than 5 per cent.
Prior to a slowdown in exports that saw the seasonally adjusted trade surplus shrink 35 per cent to €1.99 billion in June, Minister for Finance Brian Cowen had said he expected to up his forecast for GDP growth this year.
However, it was left unchanged at 5.1 per cent when the government published its mid-year outlook earlier this month.
Some economists still believe that growth can come close to Mr Cowen's goal, however, and remain one of Europe's fastest growing economies.
"We expect a marked pick-up in growth in the second quarter as a result of a recovery in exports, with goods exports up 3.5 per cent year-on-year in the quarter after a decline in the first quarter," AIB chief bond economist Oliver Mangan said.
However, Mr Mangan also said he had cut back his 2005 GDP forecast to 5 per cent from 6 per cent following the weak first-quarter data.
Economists now expect the consumer price index to rise 2.4 per cent in 2005 versus a median forecast of 2.25 per cent in last month's survey but overall they believe price pressures are still well under control in Ireland given the growth rate.