NI economic roundup

Chart showing Northern Ireland house prices being 49% below their peak

It has been a busy past week or so for economic data, covering, amongst other things, the housing market, labour market, inflation, and oil prices. Ulster Business magazine also published its list of NI’s Top 100 Companies. Here’s a rundown of the main points:

1. Housing market: Northern Ireland’s Residential Property Price Index for Q2 2015 was published on Wednesday of this week. It showed that:

  • Between Q1 and Q2 2015, the average house price in NI rose by 3%.
  • Year-on-year, prices were up 6%.
  • The standardised average price of a home in NI is now just over £113,000.
  • Prices rose in all council areas over the quarter, except Londonderry and Strabane, where they were unchanged.
  • Average prices are now 1% above Q1 2005 levels.
  • Average prices are still some 49% below their peak.
  • There were 4,600 verified sales in Q2, which was up over the quarter, but 12% lower than the same period last year.

The Office for National Statistics (ONS) House Price Index was also published this week. It pointed to NI house price inflation of 10.6% year-on-year in Q2. This was the fastest rate of growth of any UK region (UK = 5.6%).

2. Inflation: The Consumer Prices Index was out on Tuesday. The main points were:

  • CPI grew by 0.1% in the year to July 2015, up from 0.0% in the year to June 2015.
  • A smaller fall in clothing prices on the month compared with a year ago was the main contributor to the rise in inflation.
  • Falling prices for food and non-alcoholic beverages partially offset the rise

Chart showing Brent crude prices3. Oil Prices: Fears of a Chinese-induced global economic slowdown is a key driver behind the decline in global commodity prices. The Bloomberg Commodities Index is a price index covering 22 separate commodity types including metals, gas, oil and foodstuffs. 18 of the 22 indices are officially in bear market territory.  This is defined as a decline of over 20% relative to recent peak. The overall Bloomberg Commodities Index has fallen by 29% year-on-year.

Oil price has been falling due to a slowdown in demand and a supply glut. The price of a barrel of Brent crude oil fell below the £30 mark for the first time since February 2009. The price of a barrel of crude oil in dollar terms has fallen from $115pb in June 2014 to below $47pb. Petrol & diesel prices have begun to fall again in recent weeks and this trend is set to continue given the fall in the oil price.

4. Top 100 Companies: Ulster Business magazine’s Top 100 Companies list was published on Monday. Amongst its highlights were:

  • Northern Ireland’s biggest 100 firms posted sales of more than £22bn in 2014
  • Moy Park was ranked the number one NI company for the fourth year running
  • Moy Park’s profits jumped by £33m, off the back of a 10% rise in sales.
  • Combined sales for the top 100 companies rose by almost 6% on the previous 12 months

Chart showing NI's claimant count versus the UK average

5. Labour Market: The latest NI labour market figures (April-June 2015) came out last week. They showed a weakening of the labour market:

  • The headline ILO unemployment rate rose from 5.7% in Q4 2014 to 6.5% in Q2 2015
  • The seasonally adjusted number of people claiming unemployment benefits stood at 43,500 in July
  • The differential between the NI and UK unemployment rate is now at its widest margin since December 2003
  • The latest labour market figures also signal a rise in economic inactivity and a fall in employment.

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