Ireland’s Economic Outlook 2026: Markets, Tourism and Consumer Trends

Join Jane Kavanagh from AIB’s Corporate Treasury desk, AIB Chief Economist David McNamara, and Jonathan Clarke, Head of Hospitality, Tourism & Leisure with AIB Business Banking, for the first Market Talk podcast of 2026.

In this wide‑ranging episode, the panel reflects on how the Irish economy and key sectors performed through a challenging 2025 and shares their outlook for 2026 amid ongoing geopolitical uncertainty and shifting market dynamics. Tune in for:

• A deep dive into Ireland’s hospitality and tourism sector, including a slow start to 2025 followed by a strong rebound in visitor numbers and consumer spending
• Insights into changing consumer behaviour, premiumisation trends, and the challenges facing pubs, restaurants, and rural hospitality businesses
• An overview of Ireland’s domestic economic resilience, labour market strength, and how Ireland compares with global peers
• Global market perspectives covering the US, Eurozone, UK, and Asia, with a focus on growth trends, equity markets, and investor sentiment
• Central bank outlooks for the ECB, Bank of England, and Federal Reserve, including expectations for interest rate cuts in 2026
• Currency market analysis, including euro/dollar and euro/sterling forecasts and what exporters should watch
• Discussion on US trade policy, tariffs, and what recent developments mean for Ireland and European trade
• A forward-looking view on tourism demand, hotel supply, cost pressures, and why the sector remains cautiously optimistic for the year ahead

Stay informed with expert analysis and practical outlooks for the new year. Subscribe to AIB Market Talk for ongoing financial market insights.

AIB Economic Analysis - https://aib.ie/fxcentre

AIB Business Banking Hospitality - https://aib.ie/business/sector-expertise/hospitality

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Transcript

AIB Market Talk - 27 February

 0:04
 You're listening to AIB Market Talk, bringing you financial market insights from AI BS experts.

 0:12
 Hello and welcome to our AIB Market update on Friday the 27th of February 2026.

 0:17
 I'm Jane Kavanagh from our corporate Treasury desk.

 0:19
 And for our first podcast of 2026, I'm joined not only by AI BS Chief Economist, David McNamara.

 0:24
 And I feel like we should have a small little bit of a drum roll here, but also the head of our hospitality, tourism and leisure sector with business banking, Jonathan Clark.

 0:34
 Jonathan, there's so much to talk about in a sector that's caught the economy, one often in the headlines for that matter.

 0:40
 But just briefly, how did the sector see our 2025 and what themes are coming through for 2026?

 0:46
 Thank you, Jane, for having me here today.

 0:48
 So it was a slow start I suppose for the beginning of the year in 2025.

 0:52
 There was the geopolitical uncertainty and and the tariff situation.

 0:57
 And then we had the Dublin passenger airport cap as well at the beginning of the year to to contend with.

 1:02
 So tourist numbers were slow for the first part of the year up till around August time.

 1:08
 And thereafter they, they really shot through the roof then and we saw a kind of renewed demand from the GB and North American market, which which would be two crucial markets for the tourism sector over here.

 1:20
 When I look at kind of December itself, it was, it was a records month for it was a record December with over half a million overseas visitors, which was 30% higher than than December 2024.

 1:34
 So a real strong end to the year, which was great to see in many of our pubs as well.

 1:39
 And restaurants have also reported really strong sales for December.

 1:42
 So really happy with how the year ended.

 1:45
 When I look at our own car data for AOB customer spends, we see there is still a demand for leisure and hospitality spends, but we're actually, we're seeing the volume of spend down, average spend is up.

 1:58
 So the frequency of of spend is definitely a trend that is what we're seeing to decline.

 2:03
 But when people are going up, they're tending to spend more money as well.

 2:06
 And some of that is inflation.

 2:07
 You know, many prices have increased by uppers of of 25% over the past kind of five years or so.

 2:14
 So, so, so there's definitely an element there of many prices increasing, but we're also seeing a premiumisation as well within the market and consumers are willing to spend when they when they go out, they're kind of out, out and they're willing to spend on the premium products.

 2:27
 So that's definitely a trend within the sector.

 2:29
 So going out less often, but when they go out, they go out property, they go out hard.

 2:34
 Yeah, yeah, exactly.

 2:35
 Perfect.

 2:35
 Yeah, yeah, yeah, that's definitely a trend that that we're seeing as well.

 2:40
 When I look at the hotel market, a really strong performance for for accommodation providers as well in terms of occupancy, we're up at kind of 78% for year end in 2025, which ourselves in the UK that's a kind of leading the way in Europe in terms of hotel occupancy.

 2:57
 And then when we look at average room rates, we're kind of middle of the roads we're we're around 170 mark.

 3:04
 So we're kind of middle of the pack in that respect in terms of room rates.

 3:06
 But overall revenue per available room is up around 3% year on year.

 3:10
 So you know a strong end to the year given H1 was was pretty slow.

 3:16
 So that's very positive there as well.

 3:18
 And also when I just look at some of the food service side of the market as well with some of the board be a data as indicated that they expect around a 5% increase in in the food service sector year on year from 2024.

 3:31
 So look, a positive overall, but it just took a while to get going.

 3:35
 So stead, steady growth ahead, I suppose, Jonathan, which is, which is a positive.

 3:39
 We'll take that.

 3:39
 Absolutely.

 3:40
 And David, Jonathan has alluded to a resilient domestic market from a domestic perspective.

 3:46
 Would you echo this sentiment on how 2025 finished the year?

 3:50
 And I suppose with that in mind, what are you seeing when you're looking out to 2026?

 3:54
 Like the first thing to say is, uh, it's really positive actually to get those insights from Jonathan because, you know, the, the tourism and hospitality sector is a real bellwether for the domestic economy.

 4:04
 And it's very difficult as an economist because we have this very unique economy where GDP is essentially driven by a couple of large multinationals.

 4:10
 And it's very hard for us to drill down to understand what's happening underneath the bonnet.

 4:15
 So insights from, from, from Jonathan and his teams are really valuable.

 4:19
 And actually the data we're looking at really chimes with, with what Jonathan has just described.

 4:23
 I think we did see a little dip in the Irish economy through the middle of last year, no surprise given the uncertainty globally around tariffs, etcetera.

 4:33
 And we saw hiring for example start to slow down.

 4:35
 We saw that in our PMI surveys.

 4:38
 And so at that stage, we were, we were a little bit worried about the the prospects for the Irish economy given our alliance on trade and on on the US for FDI.

 4:46
 But actually at the turn of of the year now into 2026 and at the back end of last year, we've actually seen the economy actually come back a little bit stronger.

 4:55
 So those domestic indicators trending stronger, retail sales, consumer spending, unemployment having ticked up a little bit, has ticked back down to 4.7%.

 5:04
 We've just had the jobs numbers released for Q4507000 jobs created last year, employment growing by over 2%.

 5:13
 So really I would say characterise it as pretty robust.

 5:17
 And despite all of the the noise that's out there, I think both in Ireland, the European economy and globally, I think we've been surprised the upside in terms of the strength of the economy through what has been a period of high uncertainty.

 5:29
 We'll look a bit more at that noise a little bit later in the podcast.

 5:32
 But I suppose what you talk about there in terms of the Irish economy and, and growth in the labour market, how do you compare that to what we're seeing globally from the other major economies?

 5:43
 Oh, I mean, the Irish economy has been a star performer really.

 5:46
 So if you, if you look at it over a longer period of time, since the beginning of 2020, so we're halfway through the decade now.

 5:52
 Uh, over the five years to the end of last year, uh, the, the workforce in Ireland has grown by 20%.

 5:58
 So nearly 470,000 people extra at work than they were at the start of the decade.

 6:04
 So that's just phenomenal growth by any metric.

 6:07
 Look at it over an even longer period, an extra nearly 1,000,000 people at work since the through after the global financial crisis, the Irish, the workforce growing by 50%.

 6:18
 So compared to our peers in Europe that that growth far surpasses the growth we've seen in in other European markets.

 6:25
 And yes, it's driven by the multinationals and the export sector.

 6:27
 But I I think under appreciated as well is the, the, the domestic story, the recovery across all sectors of, of the economy, both in, you know, tourism and hospitality and other sectors.

 6:38
 So, you know, we're coming off a period of very rapid growth.

 6:42
 We do think we'll start to see that ease now and, and, and slow down slightly.

 6:46
 Umm, but we do expect that that wrote those robust rates of growth will continue, albeit at a slower pace over the next couple of years.

 6:53
 And looking at the wider financial picture, then what, what market trends are you seeing coming through, David?

 7:00
 Again, I know Eurozone growth, it's there, it's small, um, looking to the US, it's, it's, it's fairly strong.

 7:07
 So what, what are you seeing in terms of the, UM, the outlook now towards 2026?

 7:12
 Look, I think, as I said, uh, resilient global growth so far, the US continues to be an outperformer despite of all the kind of, you know, the policy volatility coming out of the, the Trump administration.

 7:22
 Umm, the US economy is performing well.

 7:24
 We're waiting for the turning point in Europe, you know, uh, increased infrastructure defence spending are expected to boost growth, particularly in Germany.

 7:31
 Umm, that's kind of been in the mail for a little while now.

 7:34
 And this is the year where maybe we, we start to see that uptick come through and we expect that it will, umm, UK economy, uh, not doing as well, but the, you know, the indicators, they're fairly robust.

 7:45
 But again, that's an economy that's you're seeing a lot of uncertainty around politics.

 7:50
 Umm, so I suppose the trend over the, the course of this year has been huge amount on geopolitics.

 7:55
 I mean, we could spend all day here talking about, you know, Greenland tariffs.

 7:59
 We might go into maybe the latest salvo from the Trump administration.

 8:03
 Umm, but I think I would summarise it as resilient.

 8:06
 So kind of markets trading through that uncertainty.

 8:09
 One feature I would note though is that there's, I think there's been a little bit of a pivot away from the US and maybe there's a de risking around the AI story, which you know has, you know, has gained a serious amount of momentum in the last year.

 8:22
 If you look at the S&P 500 in the in the US, it's up just over 1% year to date.

 8:28
 But if you look at the benchmark European equity index, the euro stocks 50 that's up 7% here today.

 8:34
 And you're seeing a similar story in Asian markets and in the UK as well, where you're seeing this.

 8:39
 I suppose that not not necessarily a sell USA by other countries, but the incremental and capital is moving to other markets to de risk and you're seeing jittery markets in the US around software companies, what AI might mean for those.

 8:52
 And so you're seeing sharp sell offs and volatility in those markets.

 8:55
 Uh, the dollar is slightly weaker here today.

 8:57
 Umm, particularly against the majors like the euro, umm, and then if you look at bond markets and yields and rates more generally, uh, slightly lower, so down by sort of like, you know, between 5:00 and 10:00 basis points since the start of the year.

 9:11
 So markets relatively became, uh, some more central MA or central bank, uh, rate cuts in the offing for this year, particularly for the Bank of England and the Fed.

 9:20
 They'll probably get down towards 3% from the current 3 1/2, uh, at rates.

 9:24
 And I think the ECB is probably stuck and it's on hold at its current 2% rate.

 9:30
 We don't expect it to move this year or in the foreseeable future.

 9:33
 OK, we'll unpack that a little bit more, I think as well, because there's a lot more to that too.

 9:38
 Very robust numbers there when you talk about employment in Ireland and certainly star of the class.

 9:44
 So Jonathan, coming back to you then and the sector and I'm interested to break it down a bit further, look into food and beverage first, some interesting statistics here.

 9:54
 I'll be looking back over the last 20 years, caveat that with a substantial decrease in alcohol consumption since 2001, which which aligns with the decline and the number of pubs out there.

 10:03
 Tell me a bit more about that.

 10:05
 Yes, Jane, I mean, we're seeing around 150 pubs closures each year now.

 10:10
 And I think the numbers down around 25% decline in pubs over the last 20 years or so.

 10:16
 And that that's really impacted rural islands more than it has the city's.

 10:19
 Dublin is only down about 2% in terms of pub numbers, whereas the likes of of Limerick is down around 37%.

 10:27
 Softly in clear would also be down 3433% as well.

 10:30
 So it, it very much is an urban rural divide there as well.

 10:34
 And, and, and it's not only pubs, like we see nightclubs as well, they're down significantly further.

 10:40
 They're down around 85%, you know, the last 20 odd years.

 10:43
 So, and, and I think that that's really down to a change in how we socialise now as well.

 10:49
 So the, the, I'm going to say I'm really old today, but the youth of today are socialising a lot different than, than, than we were as as teenagers, as, you know, when we were in our young 20s as well.

 10:59
 In terms of alcohol consumption, it you know, it really been reduced in in that customer cohort here and, and in terms of focusing on a more healthy, balanced lifestyle.

 11:11
 So that's, that's definitely impacting the licenced trade sector.

 11:14
 The food service side, as I say, as I referenced earlier, the board be a report indicating that there was a a 5% increase in, in, in spend in the food service sector.

 11:24
 And that's that I mean, that's quite broad.

 11:25
 That's hospitality.

 11:26
 It's also corporate institutional spend on, on on food related products as well.

 11:30
 But but that's quite positive.

 11:32
 And we expect another 5% growth this year as well.

 11:35
 So that that's quite positive.

 11:37
 But and, and I suppose we've, we've seen that again in some of our car data in terms of the restaurants, the fast foods segments of the market, we've spent up year on year where some licenced trade, the spenders has has definitely declined.

 11:49
 So you know, those in in high tourist areas with high footfall, you know, a large number of chimney pots located nearby, they're still doing well.

 11:58
 But when we rely on some of the rural pubs are definitely struggling as, as people are changing how they, how they consume.

 12:05
 And suppose what we've seen is that in rural, in rural islands, it tends to be the pubs that do well are those that, that have a broader product offering.

 12:15
 So a strong food offering now as well.

 12:17
 And, and perhaps events as well.

 12:20
 You might have quizzes or, or other entertainment offerings to, to get people in.

 12:24
 If they're not drinking the whole time, it's not sitting in a bar drinking, you know, pints of Guinness all day long.

 12:28
 You need to get them in and spend in, in other elements as well.

 12:31
 So that's definitely a trend we're seeing at the moment.

 12:34
 It's interesting that you mentioned the change in behaviour, generational if you will, I suppose which is which is impacting it.

 12:41
 Just a random question for you, actually, it strikes me, has there been a significant change in a pre COVID and the post COVID world in terms of the hospitality sector when everything was closed for so long?

 12:52
 Would that be part and parcel of what changed the behaviour as well or Absolutely.

 12:55
 And yeah, I think we we definitely changed how we socialised.

 12:59
 Yeah.

 12:59
 You know, so people were drinking at home and there were there was Al also an element of of people getting healthier, getting outside as well and and enjoying the local environment.

 13:08
 So that I mean, that has impacted how we now socialise and and engage with friends and families going forward.

 13:14
 I think.

 13:14
 So that's definitely here to, I think, of course.

 13:17
 And then turning to tourism then, which kind of leans into the aspect of hotels as well, which I, I know you were very closely with and cover.

 13:26
 Umm, tell me a little bit more about that.

 13:28
 New Dublin hotel rooms are scheduled for 2026.

 13:31
 Yeah, we're seeing a significant number there.

 13:33
 You know, it was interesting.

 13:34
 I'm just back from the Irish Hotel Federation at conference down in Killarney there and one of the topics that was discussed at length was the cost of building new accommodation.

 13:44
 It just, it just isn't economical at the moment in terms of the cost per room.

 13:49
 When you look at the market value per room, so sales prices outside of the likes of Dublin, Galway and Cork, there's very little to no real hotel development and that's because construction costs are so high and a real barrier for further development there.

 14:03
 So that's really a trend within the sector in the moment.

 14:07
 However, it does make economical sense to to build in the likes of of Dublin which which is thriving at the moment.

 14:12
 We expect new supply to be up, up around 4% year on year and and that has been the case for the past number of years.

 14:21
 And what we've seen is that demand is still outpacing supply.

 14:25
 So, so there is still a real demand for Dublin hotels and and to be fair, fortunate I've come out to say that there are also an agreement that there needs to be more accommodation in Dublin for islands to remain competitive from a tourist perspective.

 14:37
 So it really makes sense at the moment to build in Dublin.

 14:42
 What we're seeing is that it has the capacity to absorb that new supply.

 14:46
 And Jonathan, passengers through Dublin Airport remain robust year and year and obviously potentially a bit more should this cap be lifted later this year.

 14:53
 Where are you seeing the breakdown between, say, USUK?

 14:56
 Where are we primarily seeing it?

 14:57
 Yeah, I mean, the, the the Dublin Airport is crucial for the Irish tourism sector.

 15:02
 Over 80% of all overseas tourists come through Dublin Airport.

 15:06
 And in terms of the breakdown, I mean, roughly speaking, we're, we're at kind of GB would be the largest overseas market.

 15:13
 Now they tend to stay shorter length of time and, and often they stay with friends and family as well.

 15:18
 But they, they do have a large spend in the pubs and, and restaurants around Ireland as well, which is, which is great.

 15:24
 Central Europe would be a second largest market by by visitor numbers and around 1/3 of all tourists come from continental Europe and then North America around just under 1/4 of all overseas tourists.

 15:36
 But in terms of bang for the buck, the North Americans are by far the largest market in terms of overall spends.

 15:42
 They stay longer and spends more and they account for around 1/3 of all spends within the overseas tourist market.

 15:49
 So although they're only accountable around 24% of all overseas tourists that they actually what they account for and a quarter of overall spends are a crucial engine for the Irish tourism sector.

 16:00
 And we see even within the the government policy, the new era for for tourism as well, that there is still a focus on protecting and growing the North American market and GB as well, but also looking further afield as well and making sure we're attractive to to Europe, but also to Asia as well.

 16:18
 So we're going to do, I think that the outlook is keep what we're doing, but but also look further afield as well to to make sure we're not overly concentrated on that market because that is that is a risk at the moment is that there is a huge amount of spend coming from North America.

 16:30
 Yeah, I mean, just on on that market when you can see the in terms of the economic impact, like a prime example was the NFL game in September in Croke Park.

 16:38
 So when you talk about the with these major events, often the economic impact is based on, you know, what this money have been spent in the economy otherwise.

 16:48
 And in the case of events like that, you have a huge amount of, in this case, Americans coming in to watch the game who may not have come to Ireland in September when the weather has turned and it's not quite as nice as the summer.

 16:58
 That is a significant economic impact because the hotels are full, the restaurants are doing well, the pubs are doing well.

 17:03
 And as you said, they're very high spenders.

 17:06
 But, you know, we have become increasingly reliant, I suppose, on that market.

 17:09
 And it's been a very good market for us over the last few years.

 17:12
 But I suppose we shouldn't forget either that the domestic market is a significant one as well.

 17:18
 And, you know, Irish households have seen very strong growth in terms of the labour market, as I said, in terms of their wages.

 17:23
 We just had data this week which showed Irish average wage growing at like 3%, so a really strong disposable income growth there as well.

 17:31
 And that, that will continue to be a big driver as well as the domestic spending that happens across the country, particularly for rural Ireland.

 17:38
 Yeah, I think that I think that's right, David.

 17:39
 The national tourism policy, the new era for Irish hospitality has a focus as well on the domestic market and really trying to grow that as well.

 17:46
 So it is hugely important and and it also helps in terms of sustainability perspective as well to try to attract those closest to home as well.

 17:55
 Jonathan, just coming back to that U.S.

 17:57
 market, just as a matter of interest, it's been said before that if the euro becomes expensive, you wouldn't see as many US tourists now with euro dollar up at the levels that it is at the minute.

 18:08
 Should we be expecting to see an impact on that?

 18:10
 the US market, Jane, tends to be skewed towards higher incomes, tends to be less sensitive to to income squeezes.

 18:18
 And from the research we've done, there doesn't seem to be a material impact on arrival numbers, the euro dollar exchange rate.

 18:26
 I think what tends to happen is that it may not impact tourists coming or US tourists coming to Ireland, but it but it may well, I'm sure it does impact the length of stay that they have when they're in Irelands and, and perhaps impacts, you know, trading down on some elements, maybe less retail spend as well.

 18:42
 So while it doesn't seem to impact tourist numbers per SE, it definitely will have an impact on their spend when they arrive in the country.

 18:49
 I guess the US to be fair, they're probably booking their flights given the long haul flights that they are, they're probably booking them far further in advance than those of our UK counterparties for a weekend.

 18:59
 Absolutely.

 19:00
 And and that's, that's a key differential there is that the, the UK market tends to be a much shorter booking period as well.

 19:07
 And they tend to say for shorter periods of time.

 19:09
 So while the UK market tends to be more price sensitive and have a shorter booking windows, there's a bit more leeway with with the US market.

 19:19
 OK, David, we talked about euro dollar there and I know you alluded to it earlier, but just to get under the bonnet a little bit more, we might just look at the currencies.

 19:27
 So near enough this time last year, the pair hit a low of 1 1/2.

 19:32
 Understandably, we have a number of exporters who've been watching the euro rise to high.

 19:36
 January this year, I think it was 12078.

 19:40
 And that followed one of the highest annual rises for for the currency pair.

 19:44
 And they're looking at this with a degree of concern.

 19:47
 On our December pod, it was suggested that the 120 handle may prove difficult to sustain with any degree of longevity, shall we say.

 19:55
 Is this still in your case?

 19:57
 It is.

 19:58
 And there's obviously downside risks.

 19:59
 We think there's probably a little bit further to go on dollar weakness this year.

 20:04
 So today as I look at my screen, we're just under 118 for euro dollar as you said that.

 20:10
 Did move briefly above 120 at the end of January when we had the the noise around Greenland and all the other stuff going on in geopolitics.

 20:19
 We think it will end the year close to 120.

 20:22
 So our range is 117 to 123.

 20:25
 And now as I said, John has said in the past, my colleague John Fahey, you need to see something else, I think to sustain a break above 120.

 20:34
 The pair hasn't, you know, traded above that handle for, for many years.

 20:40
 So what could happen that might, uh, that might see it.

 20:42
 Well, obviously something, something strange coming out of the White House, which we can't discount this year.

 20:48
 Umm, or I think maybe something that we could predict maybe more certainty is, uh, a new Fed chair in the US.

 20:54
 He looks like he's a little bit more dovish than his predecessor and potentially for more rate cuts than are priced in by markets at present, uh, markets pricing in one to two rate cuts for, for the Fed.

 21:06
 Who's to say, uh, a new chair, uh, coming in in the middle of the year and a very much an outlook that, you know, inflation is, is down.

 21:14
 The AI productivity boom is going to increase growth without driving inflation and we can cut rates.

 21:19
 So I think those are the two factors I would be watching Umm, so as we said 120 by the end of the year is our forecast with it.

 21:26
 I think a downside risk to that.

 21:28
 I, I suppose leaning into that though and and you talked about growth earlier.

 21:31
 I mean the US is firing ahead of its other counterparties really in terms of growth.

 21:35
 I'm, I'm guessing we would need to see significant uptick in the growth figures out of the Eurozone for to really make a sustainable March north of that 120.

 21:44
 I mean, the interest rate differential correlation with the currencies hasn't really materialised in the last couple of years the way it used to.

 21:52
 Yeah, No, no, I think you're right.

 21:53
 And umm, I think inherent in that is that we do expect an uptick in Eurozone growth this year.

 21:59
 Now, as I said at the start, we have been waiting for that, that, that turning point for, for quite a while with Europe, but I think there are, there are some positive signs for, for European growth this year.

 22:09
 So I think you'll see stronger US growth potentially, uh, weaker domestic growth in the US, although AI seems to be boosting GDP and investment there.

 22:17
 And I and I think the potential, the key one here is, is for further rate cuts by the Fed.

 22:22
 But you're right, Jane, I mean, I don't see the euro, I don't think anyone sees the Eurozone surpassing the US in terms of growth anytime soon.

 22:31
 But they might just close the gap a little bit this year.

 22:34
 And look, we can't talk about the dollar or on the topic of the dollar even without mentioning something that can significantly impact some of our customers.

 22:41
 What is your view on the, I'm going to say the most recent statement on tariffs?

 22:47
 I'd like to say in 10 words, but 10 words isn't going to cover.

 22:49
 OK, so we're recording this on the 25th of February.

 22:52
 So things might change by the time we published this podcast.

 22:56
 And so not to rehash everything that's happened, umm, the Supreme Court in the US, umm, struck down, umm, some of the kind of flagship tariffs, the reciprocal, so-called reciprocal tariffs that, that the US government had announced over the past year.

 23:10
 Those tariffs fed into the various trade agreements, including with the UK and with the Eurozone, Uh, or with the EUI should say.

 23:18
 So there's a big uncertainty now about what happens to those trade agreements and there's an uncertainty about what replaces those tariffs.

 23:25
 Today, in the aftermath of the, the Supreme Court decision, uh, President Trump announced that he would use other measures, umm, to apply tariffs, but they can only be applied temporarily.

 23:35
 So 150 days after that.

 23:38
 It's up to Congress in the US to decide.

 23:41
 Now, I don't think Congress in the US wholehearted has a free trading mindset.

 23:45
 There is definitely a protectionist zeal within the US Congress.

 23:48
 So I don't think we're going back to where we were five years ago, okay.

 23:51
 But I think some of the the worst excesses in terms of what the US government has done in terms of tariffs, I think their wings have been clipped a little bit now.

 23:59
 And so hopefully over the medium term we start to see tariffs slowly reduce.

 24:03
 As it stands, Asian countries, some South American countries like Brazil have seen significant declines in their tariff rate.

 24:10
 In Europe, they're around about where they were.

 24:14
 And in the Irish case, the, I suppose advertised tariff is around 5%.

 24:18
 But if you look at the actual data in terms of our exports to the US, our effective tariff rate has been about 2%.

 24:25
 So we're one of the lowest in the world world.

 24:27
 Why is that?

 24:28
 It's because pharma has had a carve out of basically zero rates and that's most of what we sell to the US in terms of value.

 24:35
 So Ireland, I think, has dodged a bullet again this week, as it has done over the past year.

 24:39
 But it does add, I suppose, a more uncertainty to the mix over the next few months around how this thing will play out over the next few months.

 24:47
 We will continue to watch that space very, very closely, just very, very quickly.

 24:51
 And David, you're a stirring fairly range bound, we're thinking.

 24:54
 I mean, it has been kind of range bound really, hasn't it, for the last while.

 24:57
 Yeah.

 24:57
 And a little bit of sterling weakness a around the kind of, I suppose political uncertainty over there, questions around the government, I suppose the, the durability of the Prime Minister, umm, around the end of the month, we think there's probably a little bit of, of sterling weakness ahead.

 25:11
 And particularly if you layer in that the, the Bank of England look like they're going to maybe cut a little bit faster than than markets are pricing.

 25:17
 And looking at the UK data, inflation is coming down quickly.

 25:21
 Wages, uh, wage growth is slowing.

 25:23
 So I actually think we'll probably see a rate cut by the Bank of England in March.

 25:26
 That's not fully priced in by markets.

 25:28
 Uh, and I think we might see another one in the first half of the year as well.

 25:32
 So in terms of our, our forecast for sterling euro, we think around 88 pence by the end of the year.

 25:39
 So we're currently around 87.

 25:41
 So very, very range bound.

 25:43
 It's been in a sort of 86 to 88 range over the past few years.

 25:47
 As I said, slight sterling weakness, but very much range bound.

 25:51
 It's only 20 years ago, was down at the low 60s I can remember.

 25:55
 Yeah, absolutely.

 25:56
 Umm, anyhow, I digress.

 25:58
 Umm, So in summary then, David, just to finish out our look at the economic, financial side of the House, what cuts do we have pencilled in across the ECB, the Bank of England and the Fed in summary?

 26:10
 OK, so as I said at the start, I think, you know, our view is that the ECB are done, umm, they're very happy where they are at 2%.

 26:17
 They cook quite rapidly over the past 18 months.

 26:20
 And if you look at inflation trends in, in the eurozone, uh, a little bit of a weakening in inflation, Umm, some have suggested because the euro is stronger, that mean the import prices fall and that might mean the euro or the ECB has to react.

 26:32
 I don't really buy that.

 26:33
 Umm, I think they're happy.

 26:35
 They've termed it as there's a very high bar.

 26:37
 I think Lagarde used that line with President Lagarde for further rate cuts.

 26:41
 So I think ECB are done, although some people might disagree with that and it's a little bit priced in for a further cut by the ECB, but we don't think they will.

 26:49
 Then I think more interestingly on the Bank of England side, umm, we think a further cut by the Bank of England down towards 3 1/4.

 26:58
 I think there's a risk downside risk there to get to 3 and then for the Fed, uh, down to three and 1/4 as well.

 27:04
 Again, there's a big wild card there around what does a new Fed chair do and how much power does he have on the rate setting committee?

 27:11
 He is only one voter after all, but the chair is hugely important.

 27:15
 And at least from what he said in the last few months, he is quite dovish.

 27:20
 Now that might have been just to get the job from the President of the United States and he might turn, turn a little bit more conservative when he gets in there.

 27:27
 But I think there is a significant uncertainty and that's to me all feeding into that potential dollar weakness over the over the next, over the next few months.

 27:35
 So nothing, nothing to see for the ECB further cuts to come from the Bank of England and the Fed Super.

 27:41
 Thanks, David and Jonathan to you for the last word.

 27:43
 Then I suppose from everything we've discussed and I did have a lot of questions for you, sorry, but what's your takeaway or your key takeaways for 2026?

 27:52
 I think David has, has reassured me that consumer spending will will be stable this year, which is which is great.

 27:58
 Like in terms of overseas tourists, we, we expect to see air passenger numbers to be up double digits this year, which is, which is significant and a great tailwind for the, for the sector as well.

 28:10
 The US market will will still remain A crucial contributor to that.

 28:14
 So there's I suppose that there's a slight element risk of a concentration as to the US market, but we expect from the demand side at least positivity I suppose where the where the real headwind will be around cost control and that's going to be paramount.

 28:27
 We have an increase in minimum wage this year.

 28:30
 We have the pension alter enrolment which will definitely challenge profitability.

 28:35
 However, on the other side we also have a reduction in the VAT rate for food LED operators from July onwards.

 28:42
 So that's a great tailwind to have as well for the sector.

 28:46
 We expect menu prices, you know, both food and drink to outpace general inflation.

 28:50
 So that may impact volumes and the frequency of, of, of spend by consumers.

 28:54
 But, but overall, and I'll sum up the summary of, of, of the IHF conference over the past couple of days, we expect a cautiously optimistic outlook for the sector this year.

 29:04
 Brilliant, Jonathan.

 29:05
 David, thanks to both of you for your insights today.

 29:07
 There's plenty for us to unpack and take away.

 29:09
 It's a really informative discussion.

 29:12
 And for our customers and listeners, we'll add the relevant links for our publications and to the notes in this podcast.

 29:17
 And don't forget to join us next month when alongside our market update, our focus and move to the manufacturing sector.

 29:23
 So to all our listeners, as always, to stay up to date with latest market developments, simply subscribe to AIB's Market Talk wherever you get your podcasts.

 29:32
 Thanks for listening to the latest edition of AIB Market Talk.

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