Ireland’s two dominant political parties will return to power for another five-year term after agreeing a new coalition deal following weeks of negotiations.

Ireland's two major centre-right parties finalised a coalition deal with independent lawmakers on Wednesday that will return Micheal Martin as prime minister and continue the previous government's high spending economic policy.

Talks between Ireland's two historically dominant centre-right parties and independent lawmakers have reached agreement that will give a new coalition government a "comfortable majority," a negotiator for one of the parties said on Wednesday.