President Barack Obama delivers remarks and takes questions from the press in the East Room of the White House, May 27, 2010 - - Alaska's congressional delegation on Thursday criticised President Obama's decision to delay offshore oil drilling in the Arctic Ocean, saying the move will cause more delays and could have big economic consequences. Environmental and Alaska Native groups, meanwhile, reacted with gratitude. Obama announced Thursday that proposed lease sales off the coasts of Alaska and Virginia and the Gulf Coast will be delayed or canceled because of the BP oil spill. Arctic drilling would not be considered until 2011.>

Goods exports bounced in Q1, while imports highlight the turn in consumer spending: Davy chief economist, Rossa White, comments  - - "Next month's national accounts will almost certainly confirm that the Irish economy emerged from recession in Q1. Further evidence was provided by yesterday's goods trade data. Exports jumped following the slippage in the second half of last year. Moreover, imports rose quarter-on-quarter for the first time since 2007. That highlights the slow recovery in consumer spending.

The value of goods exports leaped 12% in Q1 from the low Q4 base. Goods exports slid in H2 of last year, seemingly influenced by the timing of trade in the (mainly foreign-owned) pharmaceutical sector. It must be kept in mind that the average level of goods exports at €6.92bn in Q1 was still shy of the €7.47bn average in H1 2009. The value of exports was also helped by the translation effect of a strengthening dollar (about 75% of goods exports are priced in dollars and the statistics are reported in euro). Nonetheless, we reckon that volume growth in goods exports was close to double-digit on a sequential basis in Q1.

The trend in imports is perhaps more illuminating. Good imports rose 3.1% in Q1 compared with Q4, the first rise since Q4 2007 and the biggest increase since Q3 of that year. The data suggest that consumer spending is tentatively recovering, as backed up by retail sales. Consumer goods imports fell at their slowest year-on-year pace since Q1 2008, albeit that they were still falling slightly quarter-on-quarter based on our seasonal adjustment. Despite the signs of stability, it is remarkable to see that consumer goods imports slipped 27% from peak such was the depth of the Irish recession"

Economic View: Where are the sources of the return of Irish growth? Goodbody chief economist, Dermot O’Leary, comments  - - "We made the call recently that it would be confirmed shortly that the Irish recession officially ended in Q4 2009. While GDP growth is expected to be flat for the full year (with GNP down by 0.5%), this includes a negative carroyover from 2009 into 2010, implying that sequential growth will continue throughout this year. Where will this growth come from? The smaller impulse will come from consumer spending, in particular from the boost stemming from car sales (although most of the benefit of this will be leaked out of the economy through higher imports).

Nevertheless, the latest evidence that car sales for the first five months of the year have already exceeded the levels reached for all of 2009 gives some indication that the spike in savings that occurred in 2009 is reversing somewhat. The more important influence though on growth is a better global environment feeding through to the external segments of the economy. The latest statistics on this front suggest that while export growth has not picked up substantially as yet, there is evidence that firms are indeed restocking in anticipation of such an eventuality. This explains the divergence that we have seen in the trade (latest statistics released yesterday) and industrial production series.

In the first three months, exports fell by 5% while industrial production fell by 6%. While the former is in value terms, this would not explain the full difference in the two trends. Therefore, the drag on the economy that has been apparent from falling stock levels is likely to cease in 2010. These drags have been quite significant of late, knocking an average of 1.7% off annual GDP growth over the past five quarters. With investment still in decline due to a continued contraction in the construction sector and government cutbacks curtailing growth too, Ireland is still relying very heavily on an export-led recovery. Recent currency movements are helpful in this regard too.

Irish household wealth levels: Given the collapse in the economy in 2009, most would be surprised to find that net financial assets of the household sector jumped substantially last year, but that is exactly what happened, according to the latest CSO release on the issue released yesterday. Household financial assets jumped from €81bn to €111bn, a jump of 37%. There are two explanations for this: (i) Improvements in equity markets last year led to a jump in assets in pension and insurance funds, and; (ii) household deleveraging reduced the value of loans held by the retail sector by 3%. While undoubtedly a positive, we mustn’t get too carried away with this development for a number of reasons: (1) net financial assets are still 27% below their 2006 peak; (2) net financial assets, at just over 100% of disposable income, is still below that of peers (257% in the US and 243% in the UK in 2008, according to the OECD; (3) Finally, Irish households biggest asset is property, which continues to fall in value."