The private sector remained firmly in growth territory, despite rates of expansion in output and new orders easing from the previous month according to October data from the Ulster Bank Northern Ireland PMI.
The latest report, produced for the Ulster Bank by IHS Markit, - indicates that. firms continued to take on extra staff at a solid pace while input costs rose sharply again and the rate of output price inflation quickened.
“Despite on-going inflationary pressures, Northern Ireland’s private sector continued to report expansion in activity, new orders, and employment; albeit at a slower rate,” said Richard Ramsey, chief economist for Northern Ireland at the Ulster Bank.
The headline seasonally adjusted Business Activity Index posted 53.8 in October, down from 55.1 in September but signalling a further solid monthly rise in private sector output. Activity has now increased in each of the past 13 months, though the latest expansion was the slowest since July and weaker than the UK average. “Northern Ireland mirrored the Republic of Ireland in the sense that the rate of business activity growth eased.
“This was in contrast to the UK picture where there was an acceleration in activity across most regions. As a result, Northern Ireland has slipped down the business activity growth table, with only Scotland now reporting a weaker rate of growth.
“This UK strength is reflected in the rate at which new orders are coming in at Northern Ireland firms; with overall new orders growth remaining robust, despite export orders easing back.”
At a sectoral level, he said retail had been the fastest growing for the second month in a row, with the construction industry also reporting much-improved business conditions.
Output, new orders and employment also grew at faster rates in the sector, with employment growing at its fastest rate in 41-months. There were also some signs of encouragement for local manufacturing, with new orders growth rising to its highest level in over three years.
“Cost pressures remain the key challenge, with headline inflation remaining elevated largely due to rising commodity and fuel prices,” he said.
“As a result, firms continued to increase their prices for the 24th month in a row, which will continue to hit consumers’ pockets in the months ahead.”