The Central Bank is predicting a gloomy forecast for the economy this year.
The bank says inflation could peak at 8% and will average out at 6.5% for the year.
The bank also expects a slowdown in economic growth due to increases in energy costs and the impact of the war in Ukraine.
A shortage of some building materials is expected to have a negative impact on construction.
Food prices are expected to increase by an average of 5.5% and have a disproportionate effect on those on lower incomes.
The impact of any EU moves to reduce use of Russian Gas will also have a negative impact on economic activity.
It estimates the costs of assisting refugees from the war in Ukraine will be around €1billion this year, which is expected to be met from the Covid contingency fund.
This is expected to rise to €2.5billion next year before declining to €1.5billion in 2024.
