The weak pound continued to create “a tailwind” for Northern Ireland businesses last month, helping more local firms win an increased number of export orders particularly from the South, according to new research.
The latest PMI survey from Ulster Bank shows that the North’s private sector grew during September at its fastest pace so far this year and well ahead of the UK average.
Richard Ramsey, Ulster Bank’s chief economist in Northern Ireland, believes the survey shows that the local private sector managed to defy both the “political and economic uncertainty” which overshadowed September.
Mr Ramsey said significant increases in output and new business wins by firms in the North highlighted how much better they had performed compared to their counterparts in the UK as a whole last month.
“Part of the improvement in new business was reflective of continued growth of new export orders. The strength of demand across the border and in the euro area in general is also a factor helping new business from outside the local market to increase,” he said.
Output rose for the ninth month in a row. That helped to support job creation, which grew at its fastest rate since June 2014.
The retail sector emerged as the strongest performer last month according to Ulster Bank – successfully bouncing back from a less than perfect summer, while the service sector also continued to expand.
Manufacturing production in the North remained buoyant but the level of activity in the construction sector was mainly unchanged.
Business confidence hit a four month high during September and firms are optimistic that output will increase over the next 12 months.
Despite the solid growth, Mr Ramsey warned that the weakness of sterling is a double edged sword for some businesses.
“While the currency is helping companies to secure new export orders, it is also acting to push up input costs,” he said. “The rate of cost inflation quickened to a four-month high in September, with strong price rises across all monitored sectors.”
