Fitch upgrades Ireland outlook to positive

Rating firm Fitch raised its outlook on Ireland to 'positive' from 'stable', citing the eurozone country's strengthening economy after exiting an international bailout in 2013.

Fitch highlighted that tax revenues increased by 11.7 percent in the first half of 2015 compared with the same period a year ago, notably on strong corporate tax receipts. Revenues from VAT and personal income tax grew 8.0 percent and 6.0 percent, respectively.

Ireland also benefited from a low interest rate environment which has allowed it to make ahead of schedule an 18 billion euro ($19.7 billion) repayment of its International Monetary Fund loan, resulting in interest savings, the rating firm said.

"The economic recovery has broadened since our last rating review in February," Fitch said. Household consumption has "strengthened significantly" and consumer confidence, employment growth and other data support the view of the rebound.

Fitch said it was increasingly confident that Ireland's budget deficit will fall below 3.0 percent of gross domestic product this year and the country will reach its first primary surplus -- government spending less tax revenues and excluding interest paid on debt -- since 2007.

The country also was benefiting from the European Union's asset-purchase program, a weaker euro and lower oil prices, it said.

Debt was expected to drop from 107.6 percent of gross domestic product at the end of 2014 to below 100 percent of GDP by 2018.

Fitch forecast economic growth would slow from 4.3 percent in 2015 to 2.4 percent in 2016 and 2.2 percent in 2017, near what it sees as the Irish economy's growth potential around 2.0 percent in the medium term.

Fitch also affirmed Ireland's 'A-' credit rating, highlighting new upgrades on the ratings of Ireland's three largest banks: Bank of Ireland, Allied Irish Bank and Ulster Bank Ireland.

Debt-plagued Ireland became the first of the bailed-out eurozone nations to exit an IM-European Union rescue program last December -- three years after seeking help to keep its economy from collapsing completely.

Gross domestic product grew by 5.2 percent in 2014, making Ireland the fastest growing economy in the 28-nation EU, according to official data released in late July.