Northern Ireland economy to enjoy best showing since crisis, says Danske bank
Northern Ireland is set to enjoy its strongest economic performance since the financial crisis during 2015, according to predictions by Danske Bank.
The latest quarterly forecast from the lender makes a fresh prediction of 2.2% growth during this year and next - a slight increase from an earlier forecast of 1%.
Danske Bank said around 20,000 jobs had been created in Northern Ireland last year - a trend accompanied by a failing claimant count. It also predicts house price growth of around 5%.
Low inflation - now at a record 0% - was also boosting demand and maintaining strong corporate confidence.
Danske Bank chief economist Angela McGowan said household incomes would grow more quickly this year, driving up expenditure and confidence.
Business confidence would also bounce back, she said, and firms would invest. But currency fluctuations could dent confidence.
"The strong pound is, however, the biggest hindrance to the economy this year and could impact upon manufacturing sales and our tourist trade."
United Dairy Farmers chief executive David Dobbin this week said that the weakening euro was making it harder for Northern Ireland to compete in the dairy market.
Danske Bank yesterday predicted that the agri sector would shrink by 0.5% in 2015 as falling global commodity prices compound its woes - before returning to growth in 2016.
But the highest growth would be experienced in professional and scientific services and IT, with both forecast to growth by 6% - with the former experiencing the higher expansion of the two.
Private administration and support services would grow by 5%, while wholesale and retail would expand by just over 4%.
Transport and storage - as well as hospitality - were also forecast to grow by around 4%. With all six sectors accounting for nearly one third of the economy, they are tipped to contribute to the creation of around 6,000 new jobs this year.
Manufacturing would also experiencing healthy growth of around 3%, but was not expected to yield large numbers of jobs.
Instead, manufacturing would achieve growth by moving up the value-added chain and investing in technology rather than staff.
Manufacturers would also feel the pressure of the weaker euro.
Danske Bank has forecast economic growth of 2.2% in Northern Ireland in both 2015 and 2016. After years of growth, the bank predicts that the agri sector will shrink by 0.5% as food producers and processors bear the brunt of currency fluctuations and shrinking global commodity prices. Unsurprisingly, in a climate of public sector cuts, the public administration and education sectors will contract by 1% and 0.2% respectively. However, growth is forecast for professional and scientific services, and IT - with both expanding by around 6%.