The Department of Finance is expected to reduce its forecasts for economic growth and inflation this year when it publishes its annual review and outlook this afternoon.
The forecast is an indicator of the backdrop to December's budget, with the Department having said weak growth is affecting tax revenues this year.
The Department's review and outlook - which is published each August - will be its first revision to its economic forecasts since the 2003 budget. It is expected to reflect the significant softening in economic conditions in the meantime by reducing forecasts for consumption and investment.
The Department is also expected to cut its inflation forecast for this year from 4.8 per cent to well below 4 per cent.
Last December's budget predicted some upturn in the international economy would benefit Ireland in the second half of this year.
However, with the global recovery slow to appear, the Department is expected to reduce its budget forecast of 5 per cent export growth this year and trim its prediction that consumer spending will pick up by 2.9 per cent.