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Ireland has cut its 2011 GDP forecast from growth of 1.8% to 0.8%, according to the Irish Times. The cut comes months after the IMF, European Commission, and private projections also slashed their outlook for the country.Simultaneously, Dublin raised its debt to GDP ratio peak, from 102.5% to 118%, according to Reuters. Ireland will hit that ratio by 2013.
Ireland is relying on export growth to drive its economy, but this could be hindered by the continued strengthening of the euro.
Another rate hike would also contribute to that strengthening, and potentially put additional pressure on the country’s banking and real estate sectors.
The country is also expected to shed another 30,000 jobs in 2011.