Due to the impact of Britain's decision to leave the European Union (Brexit), the Central Bank of Ireland on Wednesday cut its forecasts for economic growth for this year and next year.

In its latest quarterly bulletin, the bank said growth predictions for Ireland have been cut by 0.2 percent for 2016 and 0.6 percent for 2017 due to Brexit.

GDP growth of 4.9 percent is forecast for 2016, a marginal downward revision of 0.2 percent from the previous projection, it said, adding that the forecast for GDP growth in 2017 is 3.6 percent, down 0.6 percent from the previous forecast.

Brexit will have a negative impact on Irish GDP, employment and incomes, the bank said.

It also said the key channels through which Brexit impacts the Irish economy include trade, foreign direct investment and the labor market.

Meanwhile, the bank's Chief Economist Gabriel Fagan said the UK remains a particularly important market for indigenous firms although the Irish economy has become less reliant on the UK for trade over recent decades.

"Some sectors, including agri-food, clothing, footwear and tourism, continue to have a relatively high dependency on exports to the UK and, consequently, could be affected disproportionately," he said.