Northern Ireland economy grows in first quarter of 2022

The Northern Ireland economy continued to grow in the first quarter of 2022, official figures suggest.

The service sector makes up the largest part of Northern Ireland's economy.

It saw output grow by 0.7% compared to the previous quarter and 12.4% compared to the same period in 2021.

Output in the production sector, which is mainly manufacturing, rose 0.6% over the quarter and 5.6% over the year but another survey says economic growth may have started to cool in recent months.

Earlier this week, Ulster Bank's monthly survey of business activity suggested there was a fall in output in May, the first time that has happened in over a year.

Last month, Danske Bank research pointed to a sharp fall in consumer confidence as inflation hits household finances.

• Post-Covid recovery 'may have peaked'

• Inflation hits NI consumer confidence

Ulster Bank's chief economist Richard Ramsey told BBC News NI the economic recovery may have seen a "tipping point" this year.

He said that while the economy may see a "technical recession" - two consecutive quarters of falling economic output - he did not expect significant job losses.

Mr Ramsey said he believed inflation and the cost of living crisis were the biggest cause for concern.

"This is all going to bear down on the consumer in the second half of this year," he said.

"It's one thing to have high [energy] prices in June, it's quite another if we're looking at December and January."

The official first quarter figures from the Northern Ireland Statistics and Research Agency (Nisra) also suggest that retail sales bounced back strongly after a weak close to 2021.

Sales were up 2.6% on the quarter and by 7% over the year, but retail sales were still 1% below their pre-pandemic level.

The strongest part of the services sector was transport, storage, information and communications which was up by 3.4% on the quarter.

That sector sector includes IT, travel and couriers.

The quarterly increase in manufacturing output (0.8%) was driven by increases in three of the six main subsectors:

• Food products, beverages and tobacco (4.3%)

• Engineering and allied industries (2.4%)

• Manufacture of textiles, leather and related products (2.0%)

These increases are offset by decreases in the manufacture of chemical and pharmaceutical products (12.9%), total other manufacturing (1.7%) and basic metals and fabricated metal products (0.6%) subsectors.