The Economic and Social Research Institute has revised up its growth forecast for this year to 8.9%.
It said this is due to faster than expected growth in the domestic economy and multinational corporate activity.
It also forecasts growth of 4.5% next year, but on the assumption that a Brexit agreement along the lines of the European Economic Area is reached.
In its latest quarterly economic outlook, the ESRI says unemployment should average 5.7% this year, falling to 5.1% next year.
It estimates housing completions this year at around 18,600 units, rising to 24,500 next year.
It says there are two reasons why a neutral fiscal policy by the Government - one that neither contracts nor stimulates the economy - may be preferable.
Firstly, key infrastructure deficits in Ireland, notably in public housing, require significant investment
It said this can add to the productive capacity of the economy and reduce housing costs, which can aid economic competitiveness.
Secondly, it says an explicitly contractionary budget - when the risks of a no-deal Brexit are quite high - could make any economic fallout from a hard Brexit worse, reinforcing the shock to the economy rather than insulating it from damage.
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