The Central Bank of Ireland published its second Quarterly Bulletin of 2020 in April, which focused entirely on the impact of the COVID-19 pandemic. It described the pandemic’s impact on the economy as a “severe economic shock, fundamentally different in nature and scope from types of shocks previously witnessed” and one which has resulted in the widespread shutdown of businesses and a rise in the numbers on the live register, with further job losses possible. Given the uncertainty of the situation, the Central Bank stated that it is not possible to produce a conventional forecast but is using judgement and analytical tools to estimate of the potential impact of the crisis.

Under certain assumptions it predicts that GDP could decline by 8.3 per cent in 2020, that unemployment could rise to approximately 25 per cent in the second quarter if all those receiving COVID-19 related payments are counted as unemployed, and could remain in double figures by year end.

The following action has been taken action to contain the economic effects of the pandemic and to protect consumers, households and businesses:

• 7.3 per cent of euro area GDP has been provided in the new Pandemic Emergency Purchase Programme of €750 billion until the end of the year
• The Central Bank has released the Countercyclical Capital Buffer from 1% to 0% which will further support households and businesses.
• The Single Supervisory Mechanism – of which the Central Bank is part – has announced that banks can temporarily use some of the supervisory capital buffers that they have built up in recent years.
• The Central Bank has also been working with financial services providers to help provide ‘breathing space’ for customers who find themselves in financial difficulty, through no fault of their own.