Blame it on the sunshine as new orders rise at weakest pace in months
BUSINESS activity continued to grow in the private sector in Northern Ireland in August - but at its slowest rate in four months.
Output and new orders growth both eased back, whilst export orders saw the weakest rate in 10 months, albeit that it was the 26th successive month of growth.
The latest Ulster Bank PMI report signalled a loss of growth momentum in Northern Ireland, underlining the fragility of the overall economy right now.
Although output and new orders continued to rise solidly, rates of expansion in both were weaker than recorded in July.
But the rate of job creation picked up, as did business confidence. Inflation of both input costs and output prices eased, but remained elevated.
Ulster Bank's regional chief economist Richard Ramsey pinned some of the cause on the weather.
He said: “We've perhaps never seen a year when the weather has played such a big role in our economy.
"In the early part of 2018, the 'Beast from the East' disrupted business activity, impacting on output, and more recently, the incredibly good weather has been cited as a major factor behind faster rates of growth in the private sector during June and July.
"Perhaps unsurprisingly, given the milder weather, August saw something of a slowdown.
While output and new orders growth both eased, employment fared slightly better, with a modest pick-up in growth from July's 12-month low, while, inflationary pressures eased.
Mr Ramsey added: “The August slowdown was evident across the retail, services and construction sectors.
"While they were all still growing, the uplift in output and their order books slowed significantly.
"On the other hand, manufacturing saw almost every indicator improve. In particular, the notable growth in new orders bodes well for the months ahead.
“During the next few months, it will become clearer if the latest slowdown is simply related to an easing back from June and July's weather-related high, or if this is evidence of an underlying weakness emerging.
"The fact that construction firms expect activity to fall over the next 12 months, suggests that they think it may be the latter.”