Central Bank publishes pre-Budget letter to Minister for Finance

12 September 2022 Press Release

Central Bank of Ireland

The Central Bank of Ireland has today (12 September 2022) published the pre-Budget letter sent to the Minister for Finance by Governor Gabriel Makhlouf on 22 July 2022.

The letter sets out the challenging and uncertain economic backdrop to Budget 2023.  The economy began 2022 with strong momentum as the impact of the pandemic subsided, but now faces numerous headwinds, including energy price shocks and supply chain pressures that have resulted in high inflation.

Speaking today, Governor Makhlouf said: “As the Government prepares its Budget for 2023, it remains important to focus on building resilience for the medium term as well as addressing shorter term challenges. As the ECB Governing Council indicated last week fiscal support measures to cushion the impact of higher energy prices should be temporary and targeted at the most vulnerable households and firms to limit the risk of fuelling inflationary pressures, to enhance the efficiency of public spending and to preserve debt sustainability.”1

On last week’s monetary policy decisions, the Governor said “We are acutely aware of the impact that increasing prices has on families and businesses and returning inflation to our medium-term target of 2% remains our overriding priority.  That is why we decided to continue to take steps to tackle inflation by increasing our interest rates last week.”