The Government's handling of the economy has been given a broadly positive review by the Fiscal Advisory Council.
The watchdog's latest report says the Finance Minister took a prudent approach in Budget 2018.
But it says the Government should make more ambitious plans for a so-called "rainy day fund", in case there's a downturn.
The watchdog says the urgent need to build more housing risks overheating the economy.
The latest report from the Irish Fiscal Advisory Council praises the cautious approach taken in the budget and gives a positive outlook.
But it says major investment in housing needs to be offset with balancing measures to cool down the economy.
"I suppose the report reflects the changed environment we find ourselves in compared to a few years ago where we had quite a large government deficit and budgets were all about," said Seamus Coffey, chair of the Fiscal Advisory Council.
"In this year's budget we see that the deficit is almost closed, and debt is beginning to decline."