The Engineering Employers' Federation in Northern Ireland has issued a warning about the strength of sterling and its effect on exports.

The EEF's director Peter Bloch said there were clear signs that currency movements were restraining domestic demand and that output growth was slowing. Mr Bloch said this appeared to be leading to cutbacks in investment, and lower recruitment levels.

"Prospects for the remainder of the year will depend crucially on the level of sterling, and a renewed drive for competitiveness," he said.

There is also evidence that many EEF member companies are also experiencing skill shortages, which are putting a brake on output, he added.