Wednesday

Good morning. Ireland is dealing with expensive credit, hospitality costs, airline cuts and drones remembering that planning permission still applies above ground level. Abroad, the G7, US-Iran framework and markets are all trying to price peace without trusting it too much. Let’s get into it.

1. Irish SME Loan Rates Still Bite. ESRI says Irish SME credit demand is still being hit by borrowing costs, with April rates for new Irish company loans at 4.96%, versus 3.54% across the euro area. That gap is not a spreadsheet ignorable. Dearer working capital means fewer hires, slower investment and more firms waiting for rates to fall before doing anything brave.

2. Hospitality Costs Hit Jobs. Rising costs are pushing pubs and hospitality firms towards job cuts, while Dublin City Council’s decision to double development levies on new hotels, hostels and aparthotels has drawn fire from the Irish Hotels Federation. Add brewers warning over water bills and the pattern is fairly blunt: hospitality is being asked to absorb more cost before it has stabilised its margin.

3. Aer Lingus Troubles Materialise. We had Aer Lingus in Monday’s capital-discipline story; today’s detail is sharper. The airline has cut senior management numbers by 25%, as pilots press for clarity on expansion once Dublin Airport’s passenger cap is lifted. The issue is no longer just whether Aer Lingus can grow from Ireland, but whether growth comes with enough margin to keep its owner, IAG, interested.

4. State Spending Pressure Returns To Spotlight. State spending is reported to have risen by three-quarters since Covid, putting Budget talks under a brighter fiscal light. That does not automatically mean waste; health, housing, welfare and infrastructure have all become more expensive. But with corporation tax still doing too much of the heavy lifting, the next Budget will need discipline as well as promises.

5. Manna’s Drone Plan Hits The Neighbours. Manna, the Irish drone-delivery company that raised $50m in April and plans 400 jobs across Ireland and the US, has been refused permission for a Dundrum hub after noise and location concerns. That planning decision is bigger than one site. Ireland wants more home-grown tech, but scaling it now means proving the model works above real homes, not just investor pitches.

G7 leaders backed Ukraine in Évian and agreed to increase pressure on Russia, with energy sanctions, shadow-fleet enforcement and defence support all back on the table as Trump pushes for Zelenskyy-Putin talks. The US-Iran framework has shifted markets from panic to inspection: a 60-day ceasefire, Hormuz traffic reopening and possible oil-sanctions relief, but the nuclear question still has to survive harder talks, and any follow-on deal will be judged against the old Obama-era benchmark. UK inflation held at 2.8% before an expected Bank of England hold, leaving households with stability rather than relief. Peace is being priced in but certainty certainly is not.

Finance & Markets

Finance and markets spent the week moving in different moods: real businesses are still paying for expensive money, while investors raced to price a sudden, fragile peace.

The SME credit story from the Top 5 is the useful context. Irish firms paid 4.96% on new company loans in April, against 3.54% across the euro area, the ESRI confirmed this week. That gap is expensive money in practice: refinancing costs more, expansion takes longer, and advisory work now has to build in tougher funding assumptions.

The wider finance week had compliance and consolidation written through it. Revenue's latest defaulters list named a Galway plant firm with a €106.6m settlement, a blunt reminder that cashflow trouble and tax trouble travel together. RSM, meanwhile, has agreed in principle to bring its Mexico practice into its Ireland, UK, US and Canada partnership, another sign mid-market advisory is consolidating across borders to keep pace with the Big 4.

Markets had the louder week, for good reason. The US and Iran reached a framework over the weekend to halt their war and reopen the Strait of Hormuz, though the nuclear question stays unresolved and the deal isn't formally signed until Friday. Oil fell sharply on the news; gold actually rose, as easing supply fears cooled bets on a Fed hike. SpaceX's debut added to the mood, the stock up over 50% since listing, keeping wealth managers busy fielding client excitement. Binance, meanwhile, is reportedly facing rejection of its EU licence under MiCA, which could leave the world’s largest exchange unable to serve EU clients from July.

The watch now is whether a calmer geopolitical backdrop feeds through to cheaper capital for businesses. For Irish firms, that gap still looks wide.

In Thursday’s Tá, the Sector Spotlight will be Health & Pharma.

Wednesday - By The Numbers

12.5% – Ireland's household saving rate in Q1 2026, the CSO confirmed this week; income grew faster than spending, so households banked the difference rather than spend it.

3.6% – Irish annual inflation in May, easing slightly from April as energy and clothing costs cooled, even as insurance and transport kept climbing.

36x – The multiple analysts reckon Salesforce really paid for Fin's AI agent arm alone, the piece widely seen as driving the price; the blended figure across its full $400m business works out closer to 9x.

$6bn – Bilateral trade between Ireland and Canada in 2025, with Canadian PM Mark Carney in Dublin this week pushing for deeper ties as both countries hedge against US trade uncertainty.

Sligo’s SIS Pitches is supplying hybrid pitch technology for nine World Cup stadiums, stitching synthetic fibres into natural grass so footballers can stop debating the surface and start blaming the referee again. Great bit of Irish problem-solving. Less great is the National Lottery adapting an old New Zealand Lotto ad, proving not every creative pitch travels as well. In Washington, Trump’s newly blue Reflecting Pool has already turned green with algae. Water, unlike advertising, refuses to follow the campaign plan.

The Read – Irish Times – John McManus: Revenue Taking On Local Politics Won’t End Well

You caught the derelict-property tax move on Monday, but McManus gets to the awkward bit: Revenue can collect the tax, but local registers still decide what gets taxed. That leaves councils, politics and almost 950 councillors inside the machinery. The piece is useful because it moves past the announcement and into the implementation problem. Housing policy often fails in the gap between a clean idea and a messy register. The Link: John McManus: Revenue Taking On Local Politics Won’t End Well

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