The podcast that keeps you up to date with what is happening economy-wise in Northern Ireland. Telling you what you need to know but not necessarily what you want to hear. It is better to be prepared for the economic environment we are operating in and not the world we would like to be in.
Concerns over the spread of the new Omicron variant prompted the UK to reintroduce restrictions on travel and mask-wearing this week. Difficult decisions lie ahead for the Bank of England, which must balance a potential knock to the economic recovery with evidence of increasingly widespread cost pressures and tight labour market conditions. The odds of a rate hike at next month’s Monetary Policy Committee meeting may be receding but the jury is still out.
The so-called Global Uncertainty Index hit a record high in 2019 before the word Coronavirus had even entered our consciousness. But the last 20 or so months have completely recalibrated the parameters of what uncertainty is. In the time since, businesses have had their worlds turned upside down and back again – things that they thought would never happen, did, and things they would have absolutely expected to happen didn’t – and have also therefore had to reset as well.
Continue readingRising prices are once again the hot topic, with inflation surging to 4.2% in October, ahead of expectations. Labour market data were also stronger than expected, with employment rising despite the end of furlough. Pressure is building for the Bank of England to tame rising inflation, which points towards a pre-Christmas hike next month.
The latest NI housing statistics, transactions, starts and completions for Q3 2021 were released this morning by NISRA.
Property prices, transactions and starts all rose year-on-year in Q3 2021. However, there was a modest year-on-year decline in housing completions (refers to house building not sales).
Estate agents and house builders have experienced a ‘V-shaped’ recovery. But, given the headwinds stemming from a shortage of housing stock, supply chain disruption and significant inflation with building materials, 2021 could well mark a peak in both transactions and house building activity. In 2022, residential property prices may be the only key housing market metric to still be on the rise.
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The onset of the pandemic last year led economists to conservatively pencil in double-digit unemployment rates for the UK and Northern Ireland. What economists hadn’t initially factored in was the Chancellor’s Mario Draghi-style ‘Whatever it takes’ approach to protect jobs and prevent such an outcome from occurring. Rishi Sunak quickly unveiled the Job Retention Scheme (JRS) or furlough scheme. A policy designed to prevent mass unemployment by paying employers to keep jobs until the worst impacts of COVID-19 had passed. In time, economists progressively lowThe onset of the pandemic last year led economists to conservatively pencil in double-digit unemployment rates for the UK and Northern Ireland. What economists hadn’t initially factored in was the Chancellor’s Mario Draghi-style ‘Whatever it takes’ approach to protect jobs and prevent such an outcome from occurring. Rishi Sunak quickly unveiled the Job Retention Scheme (JRS) or furlough scheme. A policy designed to prevent mass unemployment by paying employers to keep jobs until the worst impacts of COVID-19 had passed. In time, economists progressively lowered their unemployment forecasts and revised down the anticipated surge in joblessness when the furlough scheme eventually ended. After several extensions, the Job Retention Scheme finally ended on the 30 September 2021.
Continue readingDolly Parton famously sang about the grind of working 9-5 and the routine of stumbling out of bed, making coffee and battling the traffic five days a week. But the pandemic has turned that on its head and the routine of work has changed for many workers forever. It has shown that there is perhaps a whole new way to make a living.
We’re getting there. Last week’s GDP data showed we’re just 0.6% below the pre-pandemic peak in output. At a far less progressed stage is the climate transition. But amidst the concerns was much progress from COP26. The challenge for both the recovery and achieving net zero is to keep up the momentum in the face of multiple headwinds.
The Bank of England left interest rates unchanged last week, surprising markets which expected a hike following “will have to act” comments last month. What is going up, in contrast, are commitments around decarbonisation. And hopefully there are more to come in the second week of COP26.
Today sees the release of October data from the Ulster Bank Northern Ireland PMI®. The latest report – produced for Ulster Bank by IHS Markit – signalled that surging price rises acted as a brake on the Northern Ireland private sector, restricting growth of business activity and contributing to a decrease in new orders. Both input costs and output prices rose at new record rates. On a more positive note, companies expanded their staffing levels at a sharp and accelerated pace.
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