Spreadsheets tell the real story of Phil’s latest Budget

Today’s Budget speech may not have been the most exciting ever, but it was possibly the most future-focused. Indeed, Philip Hammond used the word ‘future’ 33 times at the dispatch box this afternoon, and focused heavily on measures relating to, for instance, first time homebuyers, the technology sector, electric cars. In contrast, there was no mention of pensioners and little to appeal directly to that particular demographic. This perhaps marks a new era of more youth-friendly Budgets. Continue reading

NI house-building recovery running out of steam?

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The UK housing market is tipped to feature prominently in the Chancellor’s Budget. A range of initiatives are expected to be unveiled, targeted primarily at the younger generation. There are calls for a shift in emphasis from ‘Help to Buy’ to ‘Help to Build’ schemes. It remains to be seen how Northern Ireland will benefit from these. But it’s worth considering how the Northern Ireland housing building sector is currently faring. Continue reading

Economic inactivity jumps

As far as positive headlines are concerned, Northern Ireland’s labour market statistics have been a source of rich pickings over the last 18 months. Once again today’s batch of data raises an eyebrow or two. Chief amongst these is the fall in the ILO unemployment rate – to 4.0% in Q3. This represents the lowest unemployment rate since Q2 2008 and compares with a record low of 3.2% in the summer of 2007. Continue reading

No surprise that new car sales are falling

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Northern Ireland retailers have benefited from the tourism boom and a surge in cross-border shoppers.  With the latter boosted by the post-EU referendum depreciation in sterling. This provides a veneer of consumer strength driven by visitors. However, the underlying picture is somewhat weaker.

New car sales are a key barometer of consumer confidence and provide a more meaningful indicator of the health of the consumer. Inflation has been outpacing wage growth and this is sapping household disposable incomes. A significant range of welfare benefits are also in the midst of a multi-year freeze. Against this background it is perhaps not surprising that the biggest discretionary spending item after housing, new car sales, are falling.

Showrooms reported their worst October for sales of new cars in five years, with registrations for the first 10months of the year down over 5% y/y.

2017 looks set to see the biggest annual decline since 2011. Local new car sales are over 20% below their peak in 2007.

This compares with the UK where new car sales, though falling, are still 8% above their pre-recession high. 2018 is also expected to be a challenging year for the local consumer with the cost of living squeeze set to tighten its grip.

Inflation tightens its grip on UK households

Shoppers will increasingly have noticed that the price of their groceries and the cost of filling up at the forecourt have been on the rise. Last month UK consumer price inflation, using the CPI measure, rose by 3% y/y.  This represents the fastest rate of increase since April 2012. Inflationary pressures are more marked within consumer goods (+3.2% y/y) rather than services (+2.7% y/y). Meanwhile the most comprehensive measure of inflation, the CPIH index which includes owner occupiers’ housing costs along with Council Tax (or rates in NI), nudged higher to 2.8% y/y in September. Continue reading

Job creation slows as Brexterity beckons…

A raft of data emerged from the Department for the Economy today. The most significant release was the Quarterly Employee Survey (QES) for Q2 2017 -a comprehensive survey of the actual number of jobs in the economy.  This is more closely watched than the Labour Force Survey which looks at people working in some shape or form (paid, unpaid, self-employed, voluntary etc). Continue reading

NI productivity challenge highlighted by economic data

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The Northern Ireland economy continued to expand in Q1 2017, according to today’s data, albeit at a weaker rate than in the previous quarter. Private sector growth (+0.4% q/q, +3.4% y/y) was driven by the services sector (+0.5% q/q, +3.1% y/y) with industrial production (-0.2% q/q, +2.1% y/y) and construction (-1.7% q/q, +7.9% y/y) posting quarterly contractions. The fall in industrial production though conceals strong rates of growth within manufacturing firms (+0.9% q/q & +0.9% y/y).

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