THE loyalist ceasefire has held substantially for 28 months, and the leaderships of the two main groups, the Ulster Volunteer Force and the Ulster Defence Association, are insisting that their ceasefire will continue.
However, there are signs of growing anger in the loyalist community and this will inevitably place pressure on the paramilitaries to carry out attacks.
Loyalist sources have also said that "unclaimed" attacks on republicans were likely so long as the IRA keeps up its campaign last night there was still no claim of responsibility for the bomb left beside the Sinn Fein offices in Monaghan.
The UDA was responsible for placing booby trap bombs in cars belonging to two republicans shortly alter the New Year but never admitted the attacks, as it would have done in the past, using the Ulster Freedom Fighters cover name.
Loyalists are also suspected of setting off a grenade under a van belonging to a young Catholic couple in Larne, Co Antrim, in January. The couple and their infant child were lucky to escape without injuries. Again, no claim was made.
The UVF has not been known to be involved in any "military" activity since announcing its ceasefire in October, 1994, at the same time as the UDA and the smaller group known as the Red Hand Commando. However, early indications from the examination of the substance used in the Monaghan bomb yesterday suggest that it could have been made by loyalist paramilitaries.
Forensic examination of the explosives and the design characteristics will show if the bomb was made by a UVF or UDA bomb maker.
The UVF largely stopped its bombing in 1977, but in 1994 it acquired an amount of commercial explosive, known as Powergel, from a source believed to be in Scotland or England.
In September, 1994 a month before the loyalist ceasefire, the UVF planted a bomb made of commercial explosives on board a train from Belfast to Dublin. The device only partially exploded as the train pulled into Dublin's Connolly Station and none of the passengers or crew was injured. That same month another UVF bomb, in a car outside the Sinn Fein offices on the Falls Road in Belfast, exploded but caused no injury and little damage.
Earlier, another UVF bomb, containing 15 kg of commercial explosive was planted at the Widow Scallan's pub in Pearse Street, Dublin, during a republican social function but failed to detonate. The UVF gang shot dead Martin Doherty, a Finglas IRA member who was acting as doorman at the event.
It is known that the loyalists have become increasingly unsettled in recent weeks and loyalist figures have particularly expressed anger about the decision by the Tanaiste, Mr Spring, to intervene in the parades issue in Northern Ireland. Mr Spring described the pronouncement by the Ulster Unionist leader and Orangeman, Mr David Trimble, that Portadown Orangemen would march along Garvaghy Road this year as "highly provocative".
The Tanaiste also hosted a meeting at Government Buildings last week for representatives of the Catholic residents' associations who are opposing the Orange demonstrations.
Loyalist sources in Belfast say there is considerable anger over the Tanaiste's stance on the marches issue. It was suspected that the loyalists might launch some type of warning attack in the Republic.
It is likely, however, that there will not be a serious escalation of loyalist violence at least yet. The loyalists say they do not want a full return to violence in the North because of the damage would inflict on both communities.
A reactivated military campaign would damage the credibility of the fledgling loyalist political parties, both of which polled well in the Northern Ireland Forum elections and are seeking to win seats in this year's council elections.
The loyalists would also be hit hard by RUC arrests, as is happening to the IRA at present. The 400 odd loyalists still serving sentences for offences before the October 1994 loyalist ceasefire would also lose any remaining hope of having their sentences shortened.