HOUSE PRICES "The key concern coming up to the election definitely has to be the housing market, " according to Friends First economist Jim Power. "There is an incredible amount of negative sentiment about at the moment. Asking prices are coming down. The feelgood factor that was there 12 months ago is gone. Consumer confidence has fallen considerably as a result, " he said. Interest rates have taken some of the buoyancy out of the Irish property market with speculation mounting of another hike this summer. The European Central Bank has pencilled in 3 May for a Dublin meeting. "There is definitely room for a further two increases.

The government will be praying it doesn't happen in Dublin. They should have gone to the country before now, " said Power. "The downturn in the property market is probably a good thing for us given our unhealthy reliance on what is a volatile sector, " according to Sean Byrne, lecturer in economics at the Dublin Institute of Technology. "However, it's definitely coming at the wrong time politically for the government, " he added.

EMPLOYMENT Live register figures are due for publication next Friday with Irish manufacturing surveys being published in early May. The first three months of 2007 saw several high-profile companies significantly reduce their Irish workforce and this has affected consumer sentiment, even if employment levels have grown in that period. "It's contributed to a general nervousness that's out there, " according to Power. "Now yes, we are still creating more jobs then we are losing but the ones we are losing are very high profile and have higher salaries then the ones we are creating, " he added. Irish manufacturing statistics will be published on 5 May.

EQUITIES MARKET World equity markets remain somewhat jittery after the recent blip caused by concern over the US housing market and fears over the Chinese economy.

After sustained periods of growth, the economic climate is going through one of its more uncertain spells. "We are definitely not out of the woods yet, " according to Byrne. "There is still potential for trouble on the global equities market and any economic turmoil in the US will have an exaggerated impact in this country. There is a feeling about that the party is over, " he said. "It all impacts on consumer confidence which is vitally important for governments. People tend to assume the government is responsible for a lot more then it is. This applies when things are going well as well as when they go badly, " he added.

INFLATION Inflation figures for March are due out this Thursday. The expectation is that monthly inflation figures will be down as the economy adjusts to increases in interest rates. "We look like we are heading for a headline rate of 4% but that masks the real story. The cost of living is squeezing many voters, " says Power.

"Government-induced inflation is running at between 60 and 70% over five years, which is double the actual rate.

The state itself is putting people under pressure. Voters may remember that, " he said.

INDUSTRIAL RELATIONS Public-sector unions are always in their strongest negotiating position in the run-up to an election. After some turmoil at Aer Lingus, the ESB could be set for more industrial unrest. "In the private sector, things are fine but in the public sector there could be plenty of more turmoil on the horizon, " according to Power. "It's not something the government has been willing to tackle. I think the electorate would reward them if they did take the unions on. Overall the economic climate has never been more uncertain than at any stage since this government has been in office, or at least that is the perception. In all of these issues perception becomes reality."