Danske Bank Quarterly
Economic Overview
Contents
Summary of Quarter 4 2012 and economic outlook:
Global.
United Kingdom. Northern Ireland.
1. Gross output estimates.
5
Economic growth forecast for Northern Ireland. GDP United Kingdom.
2. Labour market.
7
Employment. Vacancies.
Labour market inactivity. Unemployment
Redundancies.
3. Inflation.
11
Consumer price indices. Inflation forecast.
4. Housing market.
13
Northern Ireland. United Kingdom. Republic of Ireland.
5. Households and consumers.
14
Households’ resources. Consumer Confidence. New vehicle registrations.
6. Business environment.
17
NI Index of services and Index of Production Company liquidations.
BoE “Agents’ Summary of Business Conditions”.
7. Exchange rates and interest rates.
19
Exchange rates: £/€ and £/$. Interest rates.
TABLE 1
Annual
2010
Annual
2011Annual
2012Latest Q
Forecast
2013
NORTHERN IRELAND
Annual
2010
Annual
2011Annual
2012Latest
QuarterForecast
2013GVA growth 1.1% 0.5 -0.25 -0.1%
(Q4 Oxford forecast)
+ 0.4
Employment rate (annual average)818,100 (annual average)810,600 799,500 (annual
average) 804,000 67.2% (Sept-Nov 12) 805,500 (annual average) ILO rate 7.2% 7.3% 7.4% 69,0007.9% (Sept-Nov 12) 8.2% (annual average*) Claimant count 6.4% 6.75% 6.7% (Dec 12) 7.1% 7.3%*
UK
Annual
2010Annual
2011Annual
2012Latest
QuarterForecast
2013GDP growth 1.2% 1.5 0.0 -0.3% 1.0
ILO Unemployment 7.8 8.0 7.9% 7.7
(Sept-Nov 12) 7.8
Inflation [CPI Annual Average
(y/y change) 3.3% 4.5% 3.0% (Jan 12)2.7 3.0
UK Interest Rate
Annual Average 0.5% 0.5% 0.5% (Feb 13) 0.5% 0.5%
ROI
Annual
2010Annual
2011Annual
2012Latest
QuarterForecast
2013GDP -0.425% +0.7% +0.7% +0.2 qoq (Q3 2012) 1.3 Unemployment 13.6% 14.4%
14.7%
14.1% (Feb 13) 14.3% Inflation -0.9% 2.1% 1.9% (Jan 13) 1.2% 1.3%RoI / ECB Interest Rate
Report by Angela McGowan and
Global
:
The global economy is expected to recover in 2013 as policy uncertainty fades and global policy stimulus has become stronger. Danske forecasts global GDP to rise 3.7% in 2013 after 3.3% in 2012 (and global growth is expected to reach 4% in 2014). A fading euro crisis, increasing house prices in the US and accelerating growth in China are all contributing to a more favourable global macro picture. Emerging markets are also expected to recover from a two-year slump, which will be an important impetus for global demand. Fiscal policy, tight credit in the euro area and low wage growth in advanced economies should keep the global recovery moderate.
United Kingdom:
The UK has experienced very downbeat economic activity over the past two years and Quarter 4 data published on 25th January shows that economy contracted by 0.3 percent.
However, the economy should return to positive growth in the second half of 2013 as the global environment improves and exports rise. For 2013 as a whole Danske Bank/Oxford Economics forecasts suggest that the UK economy will grow by only 1.0% and in 2014 we project growth of 1.7%. Net exports are expected to support the UK recovery after having weighed down on growth last year when sterling appreciated.
Going forward, private consumption is expected to support growth as the UK’s recent improvement in the labour market and increases in the personal income tax allowance should take some pressure off households. The depreciated pound will also support export growth but will simultaneously create uncertainty for inflation - as the weaker pound will push import prices higher. Lower global uncertainty and improving credit conditions should ensure a better environment for investments this year. We can expect the low interest rate environment to be with us throughout this year and next. However fiscal consolidation is expected to weigh down on growth again as we enter 2014.
The Bank of England is unlikely to cut rates but the chances of the Monetary Policy Committee (MPC) adding a further £25 billion to its QE programme has risen during Quarter one. If the UK economic activity continues to show weakness then additional QE will most likely be the MPC’s preferred tool. Indeed, with a change at the helm of the Bank of England in July, there is a possibility that the UK central bank could indulge in unlimited and open-ended monetary easing in the latter half of this year in an attempt to boost GDP – new leadership often translates into new strategies.
Northern Ireland:
Overall, the data would suggest that the NI economy has contracted by 6 percent since the outset of the recession and lost approximately 50,000 jobs. The outlook remains one of subdued growth with the local economy now expected to grow at 0.4% in 2013 and 1.7% in 2014.
A degree of support for local economic growth will come from a number of directions including low interest rates and an increasing export base (manufacturing exports rose 6.5% year on year in Q3 2012). In addition, support for the Northern Ireland economy has recently come by way of the Executive’s Jobs and Economy Initiative which was announced in early November and is worth an estimated £200 million.
The housing market in 2013 will most probably be in better shape particularly when it comes to transaction levels. With prices now back to 2005 levels, buyers and interest rates at historically low levels, homebuyers could be tempted back into this market in 2013 and 2014. In terms of risk, the biggest risk for NI in 2013 stems from political unrest which has the potential to damage economic returns from a number of high profile tourist events planned for this year and deter foreign direct investment.
Republic of Ireland:
The Republic of Ireland’s economic outlook remains challenging. The forecast is for a continuation of the gradual recovery in economic activity, although at a slightly slower pace than previously projected. GDP is now expected to grow at 1.3 percent in 2013 and 2.5 percent in 2014.
During 2012 Irish economic growth and exports were negatively impacted by weakening global demand. Nonetheless the RoI experienced a small rise in GDP during the third quarter of last year (+0.2% qoq and +0.8% yoy) (Q4 GDP is not yet available). Looking ahead, the stronger euro could impact upon export growth with key trading partners.
The domestic side of the Irish economy still remains under pressure from high unemployment, which was 14.1 percent in February. Weak domestic demand is also forecast to continue along its slow path towards stabilisation. Official data suggests that the Irish residential property market, in some areas (particularly Dublin), is entering a period of stabilisation following five years of declines. The CSO’s Residential Property Price Index for November 2012, points to a gradual easing in the year-on-year rate of decline – from 17.4 per cent in January 2012 to 5.7 per cent in November 2012.
Angela McGowan Chief Economist March 2013
1. Gross output estimates
GDP United KingdomProvisional data from the Office for National Statistics (ONS) shows that the UK economy contracted by -0.3% in Quarter 4 2012, following growth of 0.9% in the previous quarter. The latest Oxford Economics / Danske Bank, Sectoral Forecast report estimates that the annual growth rate for the UK economy in 2013 will be around 1.0 percent.
Economic Activity Northern Ireland:
DETI – NI New Composite Index (NICEI)
The Northern Ireland Composite Economic Index (NICEI) is a new experimental quarterly measure of the performance of the Northern Ireland (NI) economy based on available official statistics. It is not possible to provide a comprehensive measure of quarterly Gross Domestic Product for NI due to the lack of suitable data sources. The most recent NICEI increased over the quarter three 2012 by 0.7% to 96.5.
• Activity in the NI Private sector was estimated to have increased by 1.0% in Q3 2012 compared to Q2 2012.
• Activity in the NI Public sector was estimated to have decreased by 0.1% between Q2 and Q3 2012. (See Figure 1)
Figure 1:
NI Composite Economic Index 2002- 2012Source: NISRA, NICEI published 31 Jan 2013
Results for the Private sector show a similar pattern to that for the whole economy. The index increased by 1.0% to 97.0 in Q3 2012 and has fallen by a total of 14.1% from its maximum value of 113.0 in Q2 2007 to its current value. (See Figure 2)
Figure 2: Overview of Private sector sub-indices 2002-2012
Source: NISRA, Jan 2013
Economic Growth forecast for Northern Ireland
The Danske Bank/Oxford Economics Quarterly Sectoral Forecast report (February 2013) estimates that the local economy will be flat in Quarter 1. The annual forecast is for growth of 0.4 over the entire year [see Figure 3).
Figure 3
Oxford Economics Q1 estimates and forecast of GVA growth in Northern Ireland and UK. (2008 - 2014).
Source: Danske Bank/Oxford Economics Feb 2013
N.B.: Data for Northern Ireland output are available in the form of GVA (Gross value added), where GDP = GVA + Taxes – Subsides on products (the latter two items are available only at a national level).
2. Labour market
Employment
The latest Monthly Labour Market Report (published January 2013) by the Northern Ireland Statistics & Research Agency (NISRA) shows that the number of people in employment in Northern Ireland during the three-month period September to November 2012 was estimated to be 804,000, equal to 67.2
The Northern Ireland employment rate (67.2%) remained lower than the UK average (71.4%) and was the lowest of the twelve UK regions.
% of people aged 16-64. This represented an increase of 9,000 over the quarter and 1,000 over the year.
Sectoral employment data for the June to September 2012 period showed that the local services sector employed 630 more people over the quarter. However, the construction sector saw a further decrease (-310 jobs) and Other Industries also experienced a contraction of 60 jobs. The manufacturing sector saw no change over the latest quarter. [see Figure 4
Over the year to September 2012, the public sector decreased by 0.8% (-1,760 jobs) compared to a contraction of 0.4% (-1,740 jobs) in the private sector.
].
Figure 4.
Employee jobs in Northern Ireland: Annual and quarterly % changes by industry. (Sept 2012).
Source: DETI Monthly Labour Market Report, Jan 13
Vacancies
The level of unfilled vacancies reported to the Department of Enterprise Trade and Investment (DETI) in the period ending 2nd November 2012 was 8,746, an increase of
21 percent relative to the same period last year, when vacancies stood at 7,202. On 2nd November 2012, the number of unfilled vacancies available to jobseekers was 3,461, an increase of 13% on November 2011 (3,058).
Labour Market Inactivity
The seasonally adjusted number of economically inactive persons (who are of working age) in Northern Ireland in the period September to November 2012 was estimated at 311,000 – 26.9 percent of this age-group. This is significantly higher than the UK average rate (22.5%) and is the highest of the twelve UK regions.
Unemployment
• Claimant Count (December 2012)
NISRA has reported that the seasonally adjusted claimant count in NI increased by 500 over the month of December 2012, it now stands at 65,200. The local claimant count rate now stands at 7.1% of the workforce and has increased by 7.4 percent over the year (representing an increase of 4,500 people). [see Table 2
In the UK, the claimant count fell by 12,100 in the month of December 2012 and fell by 40,500 over the year. It now sits at 1.56 million. The UK claimant count rate in December stood at 4.8% in December 2012, down by 0.1 percentage points from a year earlier.
].
Table 2. Claimant count in Northern Ireland and UK
Level Monthly change Annual change Rate %
Dec-12 (level) (level) Dec-12 Dec-11
Northern Ireland 65,200 +500 +4,500 7.1 6.6
UK 1.56 million -12,100 -40,500 4.8 4.9
Source: ONS
Figure 5. :Claimant count rate in Northern Ireland and UK (December 2011 - December 2012).
• ILO Quarterly Unemployment Rate (Sept-Nov 2012)
The International Labour Organisation (ILO) seasonally adjusted unemployment rate for Northern Ireland was 7.9% in the three-month period September to November 2012. This represents a rise of 0.1 percentage points over the quarter and 1.1 percentage points over the year. [see Table 3
The Northern Ireland ILO unemployment level was estimated to be 69,000 in September to November 2012, this was down 1,000 over the quarter but up 11,000 over the year.
].
The ILO unemployment rate for the UK was lower at 7.7% in the same period. The number of jobseekers at the national level during Sept-Nov fell by 37,000 to reach 2.49 million. (See Table 3)
Table 3. Unemployment (ILO rate) in Northern Ireland and UK
Level Quarterly change Annual change Rate %
Sept-Nov 2012 (level) (level) Sept to Nov 2012 Sept-Nov2011
Northern Ireland 69,000 -1,000 +11,000 7.9% 6.8%
UK 2,490,000 -37,000 -185,000 7.7% 8.4%
See Figure 6 below for the long-term trend in quarterly unemployment rates for both Northern Ireland and the UK as a whole.
Figure 6.
Historical unemployment in Northern Ireland and UK (September to November ILO rates 1996-2012)
Figure 7 below shows the Northern Ireland and UK monthly ILO unemployment levels from 2008 onwards. Current levels remain well below levels in the USA, Eurozone and the Republic of Ireland.
Figure 7.
ILO Unemployment in Northern Ireland, UK compared to international comparators. (Jan 2008 - November 2012).
Source: Central Statistics Office RoI, ONS UK, DFPNI, Bureau of Labour Market Statistics US
and Eurostat (various issues).
Redundancies
The Department of Enterprise, Trade and Investment (DETI) was notified of 287 confirmed redundancies in the month of December compared with 321 in the same month one year earlier. Quarter 4 saw the Department being notified of 1,520 confirmed redundancies, which was roughly a three-fold increase from the previous quarter when redundancies sat at 504. (See Table 4)
There have been a total of 3,297 confirmed redundancies from January 2012 to December 2012, an increase of 82.3% for the same period in the previous year (1,808).
When examined at Parliamentary Constituency level, the majority of redundancies during 2012 have occurred in Belfast South (664), North Antrim (550) and East Antrim (372).
At the District Council level, the majority of confirmed redundancies occurred in 2012 in Belfast (1,122, Ballymena (403) and Larne (330).
Table 4
Table 4. Redundancies in Northern Ireland.
below shows a breakdown of redundancies by industrial sector during Q4 2012 compared with the same period one year earlier.
Industrial sector Q4 2012 Q4 2011
number % number %
Manufacturing 525 35 42 8
Electricity, Gas, Air Conditioning supply 2 - 10 2
Water supply, sewerage, waste
management 0 0
Construction 355 23 133 26
Wholesale and Retail Trade 144 9 256 50
Transport 126 8 16 3
Hospitality (Accommodation and Food
service) 0 0
Information and Communication 16 1 3 1
Financials and Insurance 141 9 2 0.4
Real Estate activities 20 4
Professional, scientific and technical
activities 37 2 1 0.2
Administrative and support service
activities 76 5 28 5
Public Administration 59 4
Education 1 - 1 0.2
Health and Social Work 38 3 0
Total 1,520 100 512 100
3. Inflation
Consumer price indices
In Quarter 4 2012 UK inflation levels remained well above the Bank of England’s target averaging 2.7% y/y [see Figure 8
The RPI and RPIX indices (the latter excludes mortgage interest payments) averaged 3.1% and 3.0% in Q4 2012, - a level similar to the previous quarter.
]. This compares to the average inflation rate of 4.6 percent in Quarter 4 one year earlier.
Figure 8.
Source: ONS (January 2013 and various issues)
Figure 9 presents an international comparison of year on year rates of inflation since 2008.
Source: ONS UK, Eurostat, CSO Ireland, US Bureau of Labor Statistics (various issues)
Inflation forecast
According to the Bank of England’s Inflation Report published in February 2013, CPI inflation is likely to rise further in the near term and may remain above the 2 percent target for the next two years. Inflation is expected to average 3 percent in 2013 due to sterling’s recent depreciation and the persistent contribution from administered and regulated prices. [see Figure 10].
Figure 10.
Bank of England inflation projections, February 2013 (up to 2016).
N.B.: BoE projections are made under the assumption of that the Bank Rate moves in line with market rates and the asset purchase programme remains steady at £200 billion.
4. Housing market
Northern Ireland
The University of Ulster Index examined house prices in Northern Ireland during Quarter 4 2012 on the basis of a sample of 1,357 open market transactions. The results for the latest quarter show that the average house price in Northern Ireland remained stable at £138,969(representing no change over the quarter and an annual rise of 1.3 %).
Figure 11.
Northern Ireland House Price Indices. (Q1 2003 - Q4 2012).
DFP: Residential Property Price Index
The latest DFP Residential Property Price Index published on February 20th shows that
local house prices contracted by 3 percent between Q3 and Q4 last year and contracted by13 percent over 2012. Around 3,700 verified residential properties sold in the last quarter of 2012, a 20 percent increase on the number sold in the same quarter 2011. This index, which uses all verified property sales as recorded by HM Revenue & Customs shows that property prices are now less than half of the peak value.
Oxford Economics: House Price Forecast
The Oxford Economics outlook for house price growth in Northern Ireland is shown in
Table 5 below.
Table 5. Oxford Economics House prices forecast Jan 2013 - Growth
%.
2011 12 13 14 15 16 2017
Northern Ireland -12.2 -4.4 -3.2 -1.8 0.3 1.4 2.5
UK -1.4 1.3 -0.3 0.4 2.2 3.3 4.2
Source: Oxford Economics
United Kingdom Housing
According to the Halifax house price index, house prices at the national level rose by 1.3% in December 2012. However, house prices on the Nationwide index fell by 0.1% in December and were 1% lower on an annual basis.
Republic of Ireland Housing
The Republic of Ireland’s national Residential Property Price Index. The latest index (published on December 28th) shows that house prices in Ireland fell by 5.7 percent in
the year to November. Residential property prices grew by 1.1% in the month of November and in Dublin residentially property prices grew by 2.4% in November. Overall, the national index is 49% lower than its highest level in 2007.
5. Households and consumers
Households’ resources
According to figures from the Office of National Statistics (published on January 14thth),
Real Household Disposable Income rose by £21 or 0.5% during Quarter 3 2012 compared to the previous quarter. The household saving ratio increased by 0.3 percentage
points was 7.7 per cent in quarter 3, compared with 7.4per cent in the previous quarter. The long-term average for the savings ratio is around 5 percent. (See Figure 12)
Figure 12
Source: ONS
Consumer Confidence
Northern Ireland’s Consumer Confidence index fell by one point to 110 during Quarter 4 2012. The survey which was carried out in early December found that there was a significant fall in how consumers perceived their current financial position compared to 12 months ago. However, this decline was offset by some marginal gains in other aspects of the survey, including spending expectations and job security.
Figure 13.
Danske Bank Consumer Confidence Index for Northern Ireland. (Sep 2008 - Dec 2012).
Source: Danske Bank (2013)
N.B.: The Danske Bank Consumer Confidence Index is compiled by surveying around 1,000 people in five key areas in Northern Ireland.
UK Consumer Confidence index:
According to the GfK survey, UK consumer confidence levels rose to -26 from December's -29, beating analysts' forecasts and moving back towards to the 18-month high of -22 hit in November.
New Vehicle Registrations
Data on new vehicle registrations in Northern Ireland were published by the Department of Regional Development in January 2013. The new figures for Quarter-3 2012 show that the number of new cars registered for the first time during the quarter has increased by 2% (from 12,062 to 12,347) compared to the corresponding quarter of 2011. This is the first quarter since April-June 2010 to show an increase when compared to the same time period in the previous year.
The ten year average for new car registrations in Northern Ireland during Quarter 3 sits at around 15,380. The latest data shows that new car sales were roughly 20 percent below the long-term trend during Quarter 3.
In Northern Ireland the ten year average for “all new vehicles” registered (which includes vans, haulage vehicles buses and tractors etc) during Quarter 3 is around 22,700. The latest data shows that local registrations of ‘All new vehicles’ was down by nearly 30 percent on the long-term trend.
Figure 14: New car registrations and all newly purchased vehicle registrations in Northern Ireland. (Quarter 3 period 2000 - 2012).
6. Business Environment
NI Index of Services Q3 (+2%)
IOS Quarterly Change: The Q3 Index of Services (which draws on a sample of 1,900 companies) released by DFP on January 23rd, shows that local output levels in the
private service sector rose by 2.0% over the quarter in real terms (provisional data). Northern Ireland’s 2 percent rise compared with an increase of 1.2% reported in the UK as a whole.
IOS Annual Change: The index rose by 4.0% in Q3 2012 compared to the same period one year earlier. When the most recent four quarters are compared to the previous four quarters the rate of growth was 0.9% in real terms. The index remained some 11.8% below the peak recorded in Q3 2006, whilst the UK index increased by 6.5% in the same time period. The UK Overall Index is the largest figure on record. The most notable change this quarter was a rise of 4.0% in the ‘Wholesale and retail trade’, ‘repair of motor vehicles and motorcycles’, ‘accommodation and food service activities’ sector. The only sector to show a fall was the ‘Other services’ sector, down by 0.5% on the previous quarter (see Figure 15 below)
Figure 15
Source: DFP, January 2013
IOP Quarterly: Provisional results for the third quarter of 2012 from DETI’s Index of Production, showed that output in NI fell over the quarter (-0.1%), while output in the UK as a whole increased by 0.7%.
NI Index of Production Q3 (-0.1%)
IOP Annual: In the last four quarters there have been three quarterly decreases and one quarterly increase in output. The NI index remains some 13.6% below the peak recorded in Q2 2008 (120.6), whilst the UK index decreased by 10.8% over the same time period.
Source: DFP, January 2013
Data from the Insolvency Service of the Department of Enterprise Trade and Investment (DETI) show a total of 86 company liquidations in Northern Ireland in Quarter 4 2012.
Company liquidations Q4 2012
Compulsory liquidations fell by 20 percent in Quarter 4 relative to the previous quarter but voluntary liquidations rose marginally (+8.5%). Although liquidations were down over the quarter, the total number of liquidations were up 11 percent year on year
(from 77 to 86) [see Figure 17).
Figure 17: Company liquidations Northern Ireland. (Quarterly data from 2002 to Q4 2012).
Source: NISRA, Insolvency Service
0 50 100 150
Compulsory and Voluntary Liquidations, Northern Ireland. Q1 2002 to Q2 2011
The Bank of England’s Agents’ Summary of Business Conditions was published in January 2013 and is a summary of monthly reports compiled by the Bank of England's Agents, following discussions with around 700 businesses. The latest findings in the summary report are as follows:
Bank of England: Agents’ Summary of Business Conditions, Jan 2013
• Growth in consumer goods sales had continued at a slow rate, with contacts anticipating a late pre-Christmas surge in demand. Growth in demand for consumer services had also remained very modest.
• The Funding for Lending Scheme was expected to take a few more months to have a meaningful impact on housing market activity. But competition was improving both in the mortgage and commercial lending markets.
• Investment intentions had remained broadly stable, at a low, though positive, rate of growth.
• Export sales growth had recently steadied, in part due to demand from emerging economies.
• Growth in the output of business services had continued at a slow pace.
• The gentle easing in manufacturing output for the domestic market had not altered, but growth in output for export had steadied.
• Construction output was still lower than a year ago.
• Employment intentions had picked up a little in business services but were otherwise unchanged.
• Capacity pressures remained a little below normal. • The rate of inflation in labour costs remained low.
7. Exchange rates and interest rates
Quarter 4 Exchange rates: £/€ and £/$Over Quarter 4 last year the pound performed negatively against the euro as fears of a triple dip in the UK mounted and Euro optimism grew. Sterling touched a high of €1.2568 in early October before reaching a low of €1.2186 in the last week of December. Since then, January and early February 2013 have been quite extraordinary for the euro. During this period the euro gained against all of the 32 biggest currencies in the world. In the months ahead it is anticipated that any referendum on Britain’s membership of the EU would add to the ‘headwinds’ for sterling. (See Figures 14 and 15)
Figure 14.
Exchange rates: GBP/EUR and GBP/USD. (Quarter-4 2012).
Figure 15
Interest rates.
The Bank of England Rate is maintained at 0.5% since March 2009 and it is expected to remain at this level until the latter part of 2012 at the earliest. The 3-month LIBOR interbank rate (at which banks borrow funds from each other) averaged 0.523% throughout Quarter-4, (relative to 0.87 one year ago). In Q4 2012 1 year LIBOR averaged 1.069%.
1.2 1.21 1.22 1.23 1.24 1.25 1.26 1.27 10/01/2012 10/31/2012 11/30/2012 12/30/2012
Quarter 4 2012 Exchange Rate : £:Eur
1.56 1.57 1.58 1.59 1.6 1.61 1.62 1.63 1.64 10/01/2012 10/31/2012 11/30/2012 12/30/2012
Quarter 4 2012: £ relative to $
GBP: $• Bank of England – “Agents’ summary of business conditions – January 2013”. • Bank of England – Data from the database “Interest & exchange rates”. • Bank of England – “Inflation Report – February 2013”.
• Bureau of Labor Statistics (U.S.A.) – “CPI Detailed Report - Data for December 2012”. • Bureau of Labor Statistics (U.S.A.) – The employment situation – January 2013.
• CSO (Central Statistics Office Ireland) – “Seasonally Adjusted Standardised Unemployment
Rates” as available on the website.
• CSO (Central Statistics Office Ireland) – Table “Consumer price index by month”. • DFP -NI – “Monthly Labour Market Report - February 2013” and previous releases. • DFP NI –“Residential House Price Index”, February 2013
• DETI-NI – “Northern Ireland Index of Production - January 2013”.
• DETI-NI – “Northern Ireland Index of Services (experimental) – Quarter 3 2012, Jan 13
• DRD-NI (Department for Regional Development) – “Northern Ireland Road and Rail Transport
Statistics” (Jan 2013) and various releases from 2001 onwards.
• Eurostat – Table “HICP – All index”.
• GFK/Nop – “Consumer Confidence Barometer” - latest releases. • Halifax – “Historical house price data” as available on the website. • Halifax – “House Price Index Q4 2012”.
• Nationwide – “House Price Index”: new releases and database. • Northern Bank – “Consumer Confidence Dec 2012”
• Oanda (Forex Trading and Exchange Rates Services) – “Historical exchange rates” database
as available on the website.
• ONS – “Consumer Price Indices Statistical Bulletin – January 2012”.
• ONS – “Gross domestic product preliminary estimate – Quarter 4 2012, Jan 2013” • ONS – Data from the “Claimant Count” statistics, as available on the ONS website. • ONS – Data from the “Labour Force Survey” as available on the ONS website. • ONS – Data from “Time Series Data - UK Economic Accounts” database. • ONS – Data from “Time Series Data - Consumer Price Indices” database.
• The Insolvency Service – Insolvency Statistics, in particular the table “Insolvencies in
Northern Ireland”.
• University of Ulster – “Northern Ireland Quarterly House Price Index - for Q4 2012” and
previous releases.
23 2012.11
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UK
Prepared on 18
thApril 2012
Quarterly Sectoral Forecasts
Quarter 2 2012
Executive Summary
Economy at a standstill…
Just as signs of a recovery were beginning to emerge, the preliminary data reported that the UK has fallen back into recession, with a fall in GDP of 0.2 per cent recorded. However, concerns exist over the reliability of the quarterly UK data as the contraction was underpinned by poor performance within in notoriously volatile construction activity. Thus it is likely that the data will be revised upwards. The lacklustre growth means that the economy is almost at the same point as it was 18 months ago, and well below the peak experienced in 2008.
Little change in Northern Ireland’s fragile outlook…
The recent data for Northern Ireland gives little reason to suggest any significant change in the broad outlook. As always quarterly estimates of growth at a regional level are very volatile and subject to the performances of individual large firms but the current projection for Q2 growth in NI is a fairly anaemic. Northern Ireland continues to suffer from a relatively limited export base which is unable to fully offset the difficulties in the public and domestic sectors.
The picture is not entirely gloomy: unemployment has not risen as fast as feared and consumer confidence, though still relatively weak, has begun to improve. In addition Northern Ireland has thus far avoided the scale of job loss in public services that many local authorities have endured in the UK and with the feel-good factor over the Titanic anniversary and associated tourist events there are positives to be found.
Source: Oxford Economics
Note: Year on year growth is calculated using the growth from Q1( t-1) to Q1(t).
2013.03
