Global markets turmoil hitting Northern Ireland manufacturing, say experts
The "rollercoaster" of global equity markets last month took their toll on Northern Ireland's manufacturers, the Ulster Bank purchasing managers' index said today.
Turbulence in China's economy, exacerbated by its decision to devalue its currency, had contributed to a slowdown in manufacturing output, new orders and job creation.
But overall, the PMI said there had been slight growth of output by companies across all sectors here, and firms had increased the pace of job creation. Ulster Bank chief economist Richard Ramsey said: "Whilst Northern Ireland's trade with China is somewhat limited, the local economy is not immune from a wider global slowdown.
"The manufacturing sector is particularly sensitive to changes in global economic conditions. Indeed, the Ulster Bank PMI survey for Northern Ireland revealed a notable slowdown in manufacturing output, new orders and job creation. New order growth hit a six-month low in August and employment growth almost stagnated."
He said last month had been a "rollercoaster ride" for global equity markets, thanks to China's plunging stock market. And there was evidence from most PMI manufacturing surveys of weaker growth in August.
In addition, global trade in the first half of 2015 had expanded at its slowest rate since 2009.
Back at home, new orders and business activity had also slowed down in the services sector - which includes everything from estate agents to services. Growth of business activity for services firms was at a six-month low, the survey said.
On a brighter note, recruitment at services firms had picked up and was now at its healthiest in over a year.
Construction reported falling output, orders and employment, but shops were booming. Retailers reported good faster rates of growth in activity, new orders and employment.
Mr Ramsey said: "The return of pay rises, record low inflation and falling food, petrol and energy prices are providing something of a consumer feel-good factor."
But he said political uncertainty at home was likely to hamper business confidence.