Output growth eases again in February, but remains solid

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Today sees the release of February data from the Ulster Bank Northern Ireland PMI®. The latest report – produced for Ulster Bank by Markit – signalled further solid growth of output during February, despite the rate of expansion easing further from the high seen at the end of last year. Both new orders and employment rose at sharper rates, with growth of each broadly in line with the UK average. Meanwhile, inflation of both input costs and output prices remained elevated. Continue reading

Economic Gongs: Best and worst performers in an ongoing drama

It had everything. There was intrigue, espionage, breakups, non-stop drama, and no end of fiction and fantasy. But whether you regard last year as the prelude to an economic horror, or something from an altogether more uplifting genre, what is clear is that 2016 was an epic, with significant implications for the local, national, and global economies. So with the annual Academy Awards having just been handed out, we’ve decided to suggest some potential winners of a hypothetical Economic Gongs. Here are the economies, personalities and organisations we think should be in contention for a range of bespoke categories.

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Three-in-a-row: NI notches up its 3rd year of house price growth

5474802142_e51c292c1b_bThis year will mark the tenth anniversary of Northern Ireland’s house price peak which heralded the start of a sustained period of collateral damage for the wider economy and not just the housing market. Residential property prices peaked in Q3 2007 and subsequently troughed in Q1 2013, down a whopping 57% some 5½ years later. Since then the housing market has been in recovery mode with three successive years of house price growth. For many homeowners the last ten years has represented a lost decade with aspirations blighted by negative equity. However, the combination of house price growth and time (assuming repayments) has seen the incidence of negative equity recede.

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Growth of business activity remains solid, but inflationary pressures intensify

Today sees the release of January data from the Ulster Bank Northern Ireland PMI®. The latest report – produced for Ulster Bank by Markit – pointed to a positive start to 2017, with further increases in output, new orders and employment recorded. That said, rates ofexpansion eased from the end of last year. Meanwhile, price pressures continued to intensify, with rates of inflation for both input costs and output prices among the sharpest in the survey’s history.

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SUVs get the Toblerone treatment

lexus-1938299_1280.jpgWe’ve heard of the Crane Count, the Cappuccino Index, and even the Big Mac Index – each an alternative means of examining and predicting trends in the economy. But analysing the local carpark is perhaps an even more insightful way of understanding the various forces impacting on consumers, companies and economies, from geopolitics to the price of a barrel of oil and movements in the exchange rate. In many respects, the car park is a microcosm of the economy, and having a look at what people use to get themselves from A to B can tell us more than economists’ spreadsheets and even Bank of England briefings. Continue reading

Chief Economist’s Weekly Briefing – Better than expected

eu-1473958_1920The Bank of England’s upgrade to its GDP growth forecast this year takes it almost back to pre-referendum levels.  Meanwhile the Government published some of its post-Brexit policy goals in a discussion document.

BoostThe Monetary Policy Committee’s new forecasts show GDP growth of 2% for the UK this year. Continue reading

NI Composite Economic Index


The release of the latest Northern Ireland’s Composite Economic Index confirmed what we already knew last month. Namely, that the contraction in services sector output (-0.5% q/q) and industrial production (-1.8% q/q) pulled the private sector output index (-0.9% q/q) lower for the first time in four quarters. The overall composite economic index (public & private sector) also decreased by the same margin (-0.9%). Last month’s Quarterly Employment Survey confirmed that the public sector index (based on employment rather than output) posted its seventh consecutive quarterly decline. Public sector employment is almost 11% below its Q3 2009 peak and at its lowest level in over 14 years. Continue reading

Look beyond the economic headlines


If there’s one thing that 2016 has perhaps taught us, it’s that you have to be wary of headlines. When it came to both the EU referendum debate and the US Presidential election, partisan UK and US media organisations often dominated public discourse with overly-simplified headlines that didn’t do justice to complex and nuanced stories. Continue reading

Its productivity, stupid

During George Osborne’s reign at the Treasury, addressing the UK’s productivity challenge took a back seat role to tackling the deficit. In Osborne’s first budget statement (June 2010) the word productivity wasn’t even mentioned.  Conversely, ‘deficit’ was uttered 19 times. Indeed, six of the former Chancellor’s budget speeches failed to mention the word productivity at all. However, Osborne’s last two budgets did see a new focus on productivity with the word appearing 11 times in March. This was perhaps in recognition of the UK’s woeful productivity performance which couldn’t be ignored any longer. Tackling the deficit assumed productivity growth would hold up.  It didn’t. Continue reading

Business activity rises at fastest pace for a year-and-a-half

Today sees the release of March data from the Ulster Bank Northern Ireland PMI®. The latest report – produced for Ulster Bank by Markit – indicated that the Northern Ireland private sector ended the first quarter of 2016 on a high, with growth of both output and new orders accelerating.

PMI March 2016 findings:

  • The headline seasonally adjusted Business Activity Index rose to 56.4 in March from 54.9 in February
  • The rate of expansion in Northern Ireland was in excess of the UK average
  • Service providers recorded a sharp increase in activity, and the strongest since July 2014.
  • Growth was also seen at construction and retail companies, while manufacturing output stabilised following a fall in February
  • Employment also continued to increase at a solid pace
  • The rate of input cost inflation eased, while output prices were broadly unchanged
  • New orders also increased at a faster pace in March, the rate of growth quickening to an 18-month high
  • New export orders also increased
  • Northern Ireland companies increased staffing levels in March, for the 14th month in a row
  • Backlogs of work rose for the fifth successive month, and at a faster pace than in February
  • Although input prices continued to increase during March, the rate of inflation eased to the slowest since last November
  • The construction sector posted the fastest rise in input prices of the four monitored sectors
  • Northern Ireland companies left their output prices broadly unchanged

PMI March 2016 infographic:


Download the PMI Report (March 2016)

Listen to Richard Ramsey talking about the latest PMI

You can also click to view the Ulster Bank Construction PMI Report (ROI).