NI Enjoys 'Economic Heatwave'

This summer's spate of hot, sunny weather has helped increase business activity in Northern Ireland, according to the latest PMI (Purchasing Managers Index) from Ulster Bank.

Richard Ramsey, Chief Economist Northern Ireland at Ulster Bank, explained: "Business activity, new orders, exports and employment all increased in July. Overall, almost one third of firms surveyed reported a rise in activity last month. Local firms saw business activity increase at its fastest rate in 70 months with all sectors of the economy experiencing robust rates of growth."

The activity is good news for the Northern Ireland economy and marks the end of a five-and-a-half year period without growth.

The index recorded substantial expansion and a growth in new orders. This precipitated an increase in staffing levels during July.

Input costs continued to increase, with firms raising output prices for the second time in three months.

"It is clear from the latest PMI that Northern Ireland experienced something of an economic heatwave in July," Mr Ramsey continued.

"Not only did the sun have its hat on, but the local economy has put its recovery hat, shades and shorts on."

He remarked: "Last week marked the sixth anniversary of the official start of the credit crunch. During the 71 months that have elapsed since then, the Northern Ireland PMI has been a reliable, albeit gloomy, barometer of economic conditions for local firms. Positives, as far as the PMI is concerned, had been in short supply over this period. However, the July 2013 survey is littered with positives.

"The better weather conditions were cited as one factor while improved client confidence across the UK was another. Export orders also increased for the first time since January 2008."

The data has indicated positive signs for the construction and retail sectors, both of which have been hit hard since the downturn.

"At a sector level, it is particularly encouraging to see the construction sector report a significant pick-up in activity and new orders alongside some employment gains," Mr Ramsey added.

"Meanwhile, the retail sector also reported a strong July in what has otherwise been a challenging year. August should also be a good month for retailers and the wider hospitality industry with the World Police & Fire Games one of the key events in Northern Ireland.

"Whilst the latest survey makes for very pleasant reading it is important not to get carried away. Like economies elsewhere, Northern Ireland requires a sustained period of growth over the months and years ahead."

(IT/CD)