NI business activity hits nine-month high

Business activity in Northern Ireland hit a nine-month high in July as demand for products accelerated markedly, according to the latest purchasing managers' index (PMI).

The index reached 54.7, up from 53 in June. It was the fourth successive monthly rise and the sharpest increase since October 2002, mirroring an upward trend across the UK.

Employment grew moderately, fuelling wage inflation.

The robust performance contrasts with the Republic, where the PMI continues to languish beneath the 50-point no-change mark.

Levels of incoming new business in Northern Ireland climbed for the fourth month running and at the most pronounced rate since the start of the year, as increased business and buoyant consumer confidence triggered the release of deferred spending. Outstanding work levels also rose, in contrast to falling backlogs across Britain.

Input costs escalated markedly, while subdued output prices slumped amid intensifying competition.

Mr Pat McArdle, chief economist at Ulster Bank, said Northern Ireland's economy was performing well compared to the Republic and Britain.

"Private sector activity has continued to recover strongly and the NI PMI is now reporting levels last seen in autumn 2002 when UK GDP expanded by a healthy 2.3 per cent," Mr McArdle said.

"Although lagging behind the US, this puts Northern Ireland well ahead of the euro zone, which is broadly flat, and the Republic where the PMI readings, although improving, are still well below the no-change 50 mark."