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Falling inflation doesn't cushion harsh economic truth

By Margaret Canning

The idea that inflation is at a 55-year low is an exciting one.

In theory it gives us more spending power on luxuries and makes grocery and utility bills a little bit less intimidating.

Northern Ireland's smaller incomes mean we spend a greater proportion of our wages on essentials, so that should alleviate the pressure on all of us.

Yet it's hard to completely kick back and enjoy our relative spending freedom.

Bad news like Bombardier's decision to let go around 130 agency staff, and Andor's intention to make up to 20 redundancies, are a reminder that we can't take anything for granted.

Both are part of larger overseas interests which have poured investment into their NI operations - most markedly in the case of Bombardier.

But regardless of the ability or good work ethic of their workforce here, they'll not escape unscathed when orders for their planes fail to take off, or when conditions in Japan and Russia put a stop to orders for their scientific equipment.

Economic recovery is still fragile, as the deterioration in business activity uncovered in the Ulster Bank purchasing managers' index for December and January also remind us.

So while falling inflation is a cause for celebration and optimism, we really shouldn't be counting our (cheaper) chickens.

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