The Bank of England is debating the best way to tackle the UK’s current dose of inflation. But for the central banks of the Eurozone and the US the issue is stubbornly low inflation. Continue reading
These slides provide an update on the latest figures for the Northern Ireland economy.
The Chancellor would happily swap the UK’s current annual economic growth rate with its inflation rate. While GDP growth remains sluggish and below the rates being experienced in most other EU countries, the converse is true for inflation. Continue reading
Today sees the release of August data from the Ulster Bank Northern Ireland PMI®. The Northern Ireland private sector recorded faster rises in output and new orders during August, supporting further job creation. Sterling weakness played an important role in the local economy, helping firms to secure new export orders but also adding to inflationary pressures. Continue reading
2017 continues to be a disappointing year for new car sales at both a UK and Northern Ireland level. New car registrations in Northern Ireland fell by 9.3% y/y last month. This compared with declines of 10% for Scotland and Wales and almost 6% for England. August represented the fifth successive month of year-on-year declines for both Northern Ireland and UK dealers. Indeed, Northern Ireland has only posted one month of year-on-year gains (March) in eight months and this was linked to changes in vehicle excise duty rates (VED) which artificially inflated sales in March. Continue reading
Perhaps the most difficult job of at all at present is predicting what’s going to happen with the labour market, given the uncertainty that exists in the economy, particularly in relation to Brexit. But it’s worth analysing the available data to understand what’s happening in the jobs market and where we might be going. Continue reading
The latest Ulster Bank Northern Ireland PMI is out today. It indicates that solid growth of new orders fed through to a further increase in business activity in July. There were reports of success in securing new work from the Republic of Ireland amid sterling weakness, helping to boost total new business. Job creation was sustained, albeit at a more moderate pace, while inflationary pressures continued to ease.
Does June’s unexpected fall in the rate of inflation herald the start of a retreat? It seems unlikely. The fall in sterling that has helped push inflation higher is still filtering through into consumer prices. And even at the lower rate inflation remains uncomfortably above wage growth. That’s a considerable headwind for the economy.
Using the UK consumer price index (CPI), the annual rise in the price of consumer goods and services eased from 2.9% in May to 2.6% in June. This unexpected easing marked the first fall in the annual inflation rate since October 2016 and perhaps reduces the likelihood that more members of the MPC will vote for an interest rate hike in the near future. That has been how financial markets have interpreted this morning’s figures, with sterling losing around one cent against the euro and the US dollar immediately after the inflation release.
While the media headlines continue to focus on the ongoing political turbulence, today’s inflation figures signal that the headwinds facing the consumer are intensifying. Continue reading