Northern Ireland

Brexit uncertainty 'major feature' of private sector dip

Ulster Bank sign

Northern Ireland's private sector saw its first monthly fall in output in almost three years in March, research from Ulster Bank suggests.

Its chief economist said Brexit-related uncertainty was a "major feature."

"Export orders and employment levels dropped at their fastest rate in almost six years and firms are increasingly pessimistic about the year ahead," said Richard Ramsey.

The bank conducts a monthly survey of private sector activity.

It is considered a reliable indicator of the economy.

Manufacturing was the only sector to see output growth in March though Mr Ramsey suggested stockpiling was likely a factor.

Equivalent research covering the whole of the UK suggested stockpiling was rising at its fastest rate in 27 years.

Mr Ramsey said Brexit-related uncertainty was "becoming more and more tangible" but said it was not the only factor in weaker performance with EU export markets also slowing.

Hotly debated

"Germany, for instance, is seeing manufacturing activity falling at a rapid rate," he said.

The economic effects of the Brexit vote have been hotly debated.

Brexit supporters point to the fact that a Treasury prediction in 2016 that a vote to leave would cause "an immediate and profound economic shock" simply did not happen.

Instead the UK economy has continued to grow, albeit slowly.

However some analysts say the data shows the Brexit vote has had a negative effect, notably due to increased inflation caused by the weaker pound.

Recent research from the Resolution Foundation concludes the UK has underperformed with regards to pre-referendum expectations, while global growth over the period outperformed pre-referendum expectations.

It found that real household disposable income was £1,500 a year lower than the Office for Budget Responsibility's pre-referendum forecast - with more than half of this income hit due to higher than forecast inflation.

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