NI economy: Survey points to ‘two speed economy’

Retail businesses expect sales to remain flat

Northern Ireland's private sector economy continued to grow in June, an Ulster Bank survey suggests.

However, growth was not seen across all sectors. Manufacturing and services expanded while retail and construction saw reduced activity.

Ulster Bank economist Richard Ramsey said a "two speed economy" was becoming increasingly evident.

Construction is suffering from reduced public sector spending while retail is being hit by a squeeze on consumers.

Mr Ramsey said: "These sectors have witnessed a notable deterioration in business confidence, with construction firms expecting business activity to be significantly lower in 12 months' time, whereas retail businesses expect sales to be flat.

"Conversely, manufacturers and service sector firms still anticipate higher levels of activity in the middle of next year."

Inflation easing

Every month Ulster Bank asks a representative sample of firms about issues such as new orders, employment and exports.

The survey suggests that the Northern Ireland private sector has now been growing for five consecutive months.

It also points to further signs that inflation is easing across supply chains.

Official data published last month suggested Northern Ireland's economy may have grown significantly faster than the UK average in the first quarter of the year.

The NI Composite Economic Index (NICEI) expanded by 1.2% over the quarter and grew by 1.7% on an annual basis.

UK gross domestic product (GDP) grew by just 0.1% over the quarter and by 0.2% over the year.

The sets of figures are not produced on a fully comparable basis, particularly when assessing public sector output.

Official figures for the second quarter of the year will not be published until September.