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Record rise in new export orders in Northern Ireland

Staff Writer | December 13, 2016
The latest report produced for Ulster Bank by Markit signalled that the rate of expansion in activity at companies in Northern Ireland accelerated on the back of a return to growth of new business.
Ulster Bank
Northern Ireland   Ulster Bank PMI
A record rise in new export orders was signalled as companies benefited from sterling weakness.

On the other hand, the rate of input cost inflation quickened again and companies raised their output prices sharply.

Richard Ramsey, chief economist for Northern Ireland, Ulster Bank, said: "The first three quarters of 2016 saw a deceleration in growth in Northern Ireland’s private sector. However, following stagnation in the third quarter, the final three months of the year are shaping up to be much better.

"Indeed, business activity accelerated further in November, with the rate of expansion representing an eight-month-high. Meanwhile new orders returned to growth for the first time in five months with local firms’ order books expanding at their fastest rate since September 2014. This suggests the economy has regained some momentum going into 2017.

"Overall, whilst the latest survey of business conditions is positive at a headline level, it is something of a mixed bag within. The positives include export orders and the strong performance of the retail and manufacturing sectors.

"Meanwhile the challenges include inflation, the slowdown in employment growth and the underperformance of the services and construction industries.

"Export orders increased at a record rate in November with the pace of expansion eclipsing the previous high by a considerable margin. Sterling’s marked depreciation has boosted the price competiveness of manufactured products in export markets.

"Manufacturing output and new orders hit 25-month and 17-month highs respectively. The favourable exchange rate has also been responsible for a surge in cross-border shopping, sending retail sales and orders to almost 2½-year highs.

"Both the manufacturing and retail sectors are expanding at rates well above their pre-downturn historical averages."