We will feel benefits of global economic growth, say experts
Robust growth of over 4% is expected in the global economy in the second half of the year, according to a new report from Danske Bank.
The bank said the first three months of the year had seen soft growth – but the momentum of recovery would pick up in the coming months, with all major countries sharing in the spoils.
Danske said the pace of growth would continue into next year and would provide plenty of opportunities for investment in Northern Ireland.
Over the year as a whole, there would be growth of 3.8%, with slightly higher expansion of 4.1% the year afterwards – all driven by job growth, wealth gains from a sprightly stock market and lower inflation. Danske Bank chief economist Angela McGowan said the global environment exerted a strong influence in Northern Ireland.
"Strong global growth is good for the local economy, and as global growth goes from strength to strength Northern Ireland's economic opportunities will accelerate".
With the US's position as our leading foreign direct investor cemented, Danske said the US economy was ready for take-off and that growth would reach "escape velocity".
Ms McGowan said: "As the world's largest economy is now in expansion mode, this augurs well for our future inward investment levels.
"In addition, there are currently intensive negotiations under way to bring about a trade agreement between the EU and the US. This Transatlantic Trade and Investment Partnership (TTIP) will remove trade barriers for a wide range of sectors in Northern Ireland, making it easier for them to buy and sell goods and services from and to the US market – a market with 311 million consumers".
The report said recovery was also unfolding in Europe, with an improvement in private consumption expected to contribute to growth of around 1.2% this year.
Consumers were at their most chipper since 2007 as low inflation was lifting spending power and unemployment was coming down.
The end of the euro crisis had also helped contain uncertainty.
And there could even be uplifts in the euro area as the European Central Bank injected more liquidity. Spain, Ireland, Portugal and Greece were all showing improvements – but the weak link remained France, where house prices were still overvalued and competition poor.
Ms McGowan said recovery in Europe was vital to help the Republic's recovery – which Northern Ireland could feed off – and to help visitor numbers from Europe after a 4% decline in European holiday visitors in 2013.
Emerging markets, like India and Indonesia, were seeing some improvement – while China was also expected to experience moderate recovery in the second half of the year.
Danske Bank said it forecast growth of around 7% for China this year and next.
Global risks had receded thanks to more stable emerging markets. But diminishing monetary stimulus in the US and its potential impact on bond markets posted the biggest threat.