Private Sector Grows But Challenges Still Remain

New figures show that the private sector in Northern Ireland is performing well, in March the sector grew at its fastest rate in the last 12 months. Consumer confidence also seems to be slowly returning and inflationary pressures are beginning to recede, although they are still above pre-pandemic levels.

Only London With A Sharper Rate Of Growth

The new figures come from the latest survey by the Ulster Bank who found that there was only London in the rest of the UK that had a sharper rate of growth than Northern Ireland. However a note of caution has been sounded regarding the slowdown of the global economy and the fact that the Stormont Executive is still not functioning.

Speaking about the survey findings, the Ulster Bank chief economist Richard Ramsey is quoted in an article on the BBC News website, saying:

“Lack of a Stormont executive and a paralysis in decision-making is being felt and will continue to be felt in this sector.

“This is reflected in the new-orders indicator, which has indicated declines for 21 months running.

“Whilst we are seeing notable short-term improvements and firms are relatively optimistic for the year ahead, there are lots of challenges that will impact on future growth.”

Mr Ramsey added: “The slowdown in the global economy is one factor but the outlook for the public finances is also bleak and this is compounded by the ongoing lack of a functioning Stormont executive.

“Meanwhile, households will continue to battle with a cost-of-living crisis.”

The Economy Is Proving More Resilient Than Anticipated

And in the same article Danske Bank’s chief economist Conor Lambe is quoted as saying:

“The economy has proved more resilient than previously expected and the labour market remains in a relatively robust position.

“We still expect annual economic output to fall this year in Northern Ireland and the wider UK but we have revised our forecasts upwards relative to our previous report.

Mr Lambe added: “Persistent inflation is still a risk to the economic outlook, with inflation in the UK remaining near its multi-decade high.

“Although we think it has likely peaked, the rate of price rises is still expected to remain above its 2% target throughout this year.

“If inflation remains higher than forecast and declines more slowly than anticipated, it has the potential to constrain economic activity even further.”

So there are definitely shards of light breaking through the gloom, it will be interesting to see if these break out into full blown daylight by the end of the year.