Belfast Telegraph

Northern Ireland economy growing with hopes boosted further by DUP's £1bn deal

By Margaret Canning

Northern Ireland's economy enters the second half of the year with some positive momentum after performing better than expected from January to June, according to a survey today.

The Ulster Bank purchasing managers' index said business activity had grown last month, although at the slowest rate for eight months.

But concerns were persisting over consumer pressures, Brexit and political uncertainty. However, the recent £1bn funding package agreed by the DUP and Conservative Party was a reason for cheer.

Manufacturing companies and those in the services sector - which covers everything from estate agents to restaurants - all reported growing activity in June.

However, activity was down for building firms and retail - the first slump in five months for construction and in 18 months for retail.

Services led the way in employment growth, with construction weakest for new jobs. There was also expansion in export orders, but at the slowest rate since September.

Ulster Bank chief economist Richard Ramsey said the survey brought to a close the first half of the year and that business had performed more strongly than expected.

The services sector had come out on top, with its strong June performance buoying up manufacturing, retail and construction during the month.

Mr Ramsey said the latest survey meant the province's economy was entering the last six months of the year "with some momentum".

"Indeed, business activity has performed more strongly than would have been expected, with the services sector the star performer in the past quarter," he said.

"On the positive side, employment and exports continue to rise, but the overall theme is one of easing, with these indicators expanding less robustly than in the previous month.

"Inflationary pressures are also easing from very high levels, however, both input and output inflation remain elevated, which is a key concern for the second half of the year."

He said rising prices would weigh heavily on consumer-sensitive sectors, with some retailers already report falling sales. But there was optimism.

"They are less positive than they have been, which reflects a number of factors including reduced consumer confidence, political instability, and ongoing negotiations around Brexit.

"None of these issues appears to be going away. Concerns around Northern Ireland's public finances also remain. However, they will have been eased somewhat by the recent funding package agreed with Westminster."

Belfast Telegraph

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