September proves bumper month for business as Northern Ireland defies political gloom
Northern Ireland businesses have "defied the gloom of political uncertainty" with the fastest growth in activity in 2017 so far, a key survey said today.
The Ulster Bank purchasing managers index said the sectors of services, retail and manufacturing - had reported a growth in activity for September, with manufacturers' exports still boosted by the weak sterling.
However, services - which covers everything from estate agents to restaurants - was a star performer for job creation.
But construction remained a concern despite new orders rising. Overall, the pace of business activity in Northern Ireland firms was in contrast to the rest of the UK as the province reversed the usual trend of lagging behind Great Britain.
Confidence was at a four-month high as companies reported an increase in new orders.
However, input cost inflation remained a concern.
Ulster Bank chief economist Richard Ramsey said: "The Northern Ireland private sector continued to defy political and economic uncertainty in September, seeing further marked increases in output and new orders that were both the fastest in 2017 so far.
"Local firms are also faring better than their counterparts across the UK as a whole at present, with the acceleration in growth contrasting with signs of a slowdown at the UK level."
Exports were benefiting strongly from Brexit effect of a weaker pound, the survey found.
Mr Ramsey said: "Part of the improvement in new business was reflective of continued growth of new export orders.
"Sterling weakness continues to act as a tailwind for exports, helping firms to secure new work in the Republic of Ireland in particular.
"The strength of demand across the border and in the euro area in general is also a factor helping new business from outside the local market to increase."
And he said data on the retail sector would give solace to shopowners, as growth had managed to rebound after a slow summer.
Mr Ramsey added: "Services remained a strong performer, and registered the fastest pace of job creation for over a decade.
"Manufacturing growth remained solid while construction remained the main area of concern, although even here there was some positive news as new orders increased for the first time in seven months."
But he warned that the weakness of sterling - with one euro buying just under £0.90 on Friday - was not a universal boon.
"Sterling weakness is a double-edged sword for firms.
"While the currency is helping companies to secure new export orders, it is also acting to push up input costs. The rate of cost inflation quickened to a four-month high in September, with strong price rises across all monitored sectors.
"This, coupled with the aforementioned uncertainty, sounds a note of caution as we head towards the year-end."
Last week Danske Bank predicted growth of 1.2% for the Northern Ireland economy in 2017, followed by slower growth of 1% in 2018.