Northern Ireland may be 'already in recession', economist warns ahead of autumn budget statement

This comes ahead of a crunch UK budget statement expected later this week that Chancellor Jeremy Hunt has said will require "sacrifices" to get the economy back on track.

The statement, due on Thursday, is expected to include both public spending cuts and tax hikes.

In Northern Ireland, the Ulster Bank's latest purchasing managers index has indicated a reduction in business activity and new orders, with a measure of business confidence shrinking to its lowest level in 26 months.

Meanwhile, senior economist at Ulster University's business school Dr Esmond Birnie has suggested Northern Ireland might already be in recession with the UK on the brink.

Commenting on the publication of GDP (gross domestic produce) statistics from the Office for National Statistics on Friday, Dr Birnie said the figures "give some ground for deducing that the local, regional economy is already in recession".

Dr Birnie added: "It can also be noted that during April-June Northern Ireland’s growth performance was worse than the UK average - notwithstanding the now often made claims, usually poorly supported by evidence, that in recent times the local economy has been out-performing the rest of the UK, and that this has something to do with continued (Protocol) access to the EU Single Market, etcetera.”

Rishi Sunak, meanwhile, has pledged to deliver on market expectations with this week’s autumn budget.

The Prime Minister said Jeremy Hunt will unveil measures on Thursday to “put our public finances on a sustainable trajectory” after investors were spooked by his predecessor’s £45 billion tax-cutting bonanza.

Mr Sunak has also insisted that the budget’s difficult decisions will have “fairness and compassion at their heart”.

His comments came after Chancellor Jeremy Hunt said “we’re all going to be paying a bit more tax” as he looks to find up to £60 billion from a combination of hikes and spending cuts.

Speaking in Bali, where he is attending the G20 summit, Mr Sunak insisted “stability has returned” to the UK now he has entered Downing Street.

Pressed on whether Ms Truss’s mini-budget made his financial choices more severe, the PM told broadcasters he has already acknowledged Ms Truss made “mistakes”.