Nowcast (as of 16 July 2026)

July 16, 2026

Macroeconomics
ESRI MDD Nowcast


Highlights

  • As of July 15th, the ESRI's 2026Q2 nowcast estimates that MDD is growing at 4.0% year-on-year, up 3.7% from last month's estimate. This is the second nowcast of 2026Q2 based on data from April and May.
  • Decomposing the key drivers of this month's nowcast shows that consumption, housing, tax revenue, price data contributed positively to the estimate.
  • On the other hand, financial, labour, output and sentiment data had a negative impact on the estimate.

MDD nowcast information

  • MDD is a measure of domestic economic activity in Ireland including spending by households, investment by enterprises and net spending by the government.
  • Nowcasting is the prediction of the very recent past, the present, and the very near future state of the economy. The ESRI's nowcast uses an econometric model with a series of real-time indicators to estimate MDD before the official CSO numbers are available.
  • The MDD nowcast is produced using a Dynamic Factor Model (DFM) applied to a panel of 50 monthly indicators across eight categories: consumption, housing, prices, labour, fiscal, financial, output and sentiment.
  • The DFM extracts a single latent factor, a summary measure of Irish economic activity, which captures the co-movement across all of these indicators in real time.
  • This monthly factor is then linked to quarterly MDD via a bridge equation, providing an estimate of MDD growth before the official CSO figures are available.
  • The decomposition in the figure shows the contribution of each of the eight indicator blocks to the monthly factor. A positive (negative) bar means that category of data is currently pushing the nowcast estimate up (down) relative to trend.
  • Because the factor is a weighted summary of all indicators, the decomposition identifies which parts of the economy are driving the current estimate and can change as new monthly data arrives.

Next expected update on 20/08/2026.

Compiled by Paul Egan (paul.egan@esri.ie) & Janez Kren (janez.kren@esri.ie). Based on: Egan, P. (2023) Nowcasting domestic demand using a dynamic factor model: the case of Ireland, Applied Economics Letters, 30(19), 2711-2716.