Fourteenth successive month of growth in activity
There were sharp rises in new business activity and staffing levels in Northern Ireland companies in August, a monthly report suggests.
The latest Purchase Manager's Index – produced for Ulster Bank by Markit – signalled that firms here recorded a fourteenth successive month of growth in output, employment and export orders.
However, the survey also revealed that firms experienced their weakest expansion of activity since March and that the rate of growth in new orders was the slowest since October last year.
A further solid rise in staffing levels was recorded in August and all four sectors posted increases in employment, led by manufacturing.
Backlogs of work also continued to increase during the month, with an 11-month accumulation being recorded.
Input prices increased, with respondents linking part of the latest rise to higher staff costs.
The rate of cost inflation in Northern Ireland remained much stronger than seen across the UK as a whole.
Although companies in Northern Ireland continued to raise their output prices in August, the rate of inflation was only marginal and the weakest in three months.
Richard Ramsey, chief economist in Northern Ireland with Ulster Bank, said that as the recovery continues, growth rates are anticipated to moderate to more normal levels.
"Whilst local businesses continued to report strong demand last month, inflationary pressures remain," he said.
"The strength of sterling is likely to be a major factor here as some price competitiveness has been eroded over the last year or so.
"The strong rates of growth in new orders and activity are largely linked to work outside Northern Ireland, particularly in England.
"The latest report highlights that a sustained broad-based recovery remains on track.
"It is encouraging to note that Northern Ireland's two largest trading partners – Great Britain and the Republic of Ireland – saw an acceleration in the rate of expansion in their respective economies last month.
"This bodes well for local businesses in the months ahead," Mr Ramsey added.