PMI - Neighbourhood Retailer https://neighbourhoodretailer.com The authoritative voice of the grocery industry in Northern Ireland Mon, 15 Aug 2022 10:43:34 +0000 en-US hourly 1 https://wordpress.org/?v=6.9.4 https://neighbourhoodretailer.com/wp-content/uploads/2020/05/cropped-NR-SIte-Icon-2-32x32.png PMI - Neighbourhood Retailer https://neighbourhoodretailer.com 32 32 178129390 Retail sector hard hit by summer downturn https://neighbourhoodretailer.com/retail-sector-hard-hit-by-summer-downturn/ Mon, 15 Aug 2022 10:43:34 +0000 https://neighbourhoodretailer.com/?p=24517 Retail is leading a summer downturn in Nortern Ireland’s private sector, according to a new survey. July saw a large fall in new orders and

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July saw a large fall in new orders and exports, with retail seeing the biggest slump, followed by the manufacturing sector.

Customer demand continues to drop while inflation is leading to further sharp reductions in output by businesses, according to Ulster Bank’s purchasing managers’ index (PMI), produced by S&P Global.

New orders were down and inflation rates remain high despite some easing but there was another rise in employment.

According to the report, the business activity index dropped to 41.9 in July, where 50 means no change, down from 42.9 in June, revealing a “sharp contraction” in output.

Retail posted the fastest decline in activity, followed by construction and then manufacturing, according to the report.

“Where output decreased, respondents linked this to the impact on demand of sharply rising prices,” the survey said.

“This also resulted in a third successive fall in new orders, with the latest decline the fastest in a year-and-a-half.”

Richard Ramsey, chief economist with Ulster Bank in Northern Ireland, said “storm clouds continue to gather” in relation to the economy.

“Outside of the Covid pandemic and lockdown restrictions, July’s rate of decline in business activity was the steepest since November 2012,” he said.

“Declining market demand is attributed to rising prices. And while the rates of input cost and output price inflation are easing, they remain elevated.

“Perhaps unsurprisingly, given the cost-of-living crisis, retail recorded the steepest declines in sales and orders,” Mr Ramsey said.

“Retail sales have plunged over the last three months and retailers expect sales to be broadly unchanged (i.e. at these lower levels) in 12 months’ time.”

Respondents stated higher fuel prices are leading to increased transportation costs, while they also report rising wages. Employment increased again, continuing a run of 17 months.

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]]> 24517 New orders rise at weakest pace in four months https://neighbourhoodretailer.com/latest-retail-news-new-orders/ Tue, 11 Sep 2018 08:19:41 +0000 https://neighbourhoodretailer.com/?p=9562 New data from Ulster Bank purchasing manager’s index has showcased employment levels on the rise, but simultaneously showing weaker growth of output and New Orders.

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August PMI Data
Ulster Bank PMI data from August Info graphic

Ulster Bank PMI data from August signalled a loss of growth momentum in the Northern Ireland private sector,  with new orders rising at the weakest pace in four months.

Although output and new orders continued to rise solidly, the data – which is produced for Ulster Bank by IHS Markit – showed rates of expansion were weaker than recorded in July.

Commenting on the latest survey findings, Richard Ramsey, chief economist Northern Ireland, Ulster Bank, said:

“We’ve perhaps never seen a year when the weather has played such a big role in the Northern Ireland economy. In the early part of 2018, the Beast from the East disrupted business activity, therefore impacting on output.”

“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.”

That said, the rate of job creation picked up, as did business confidence. Inflation of both input costs and output prices eased, but remained elevated.

What does this mean?

“Output and new orders growth both eased to a four-month low in August, whilst export orders saw the weakest rate in 10 months, albeit that it was the 26th successive month of growth,” said Richard.

“Employment fared slightly better, with a modest pick-up in growth from July’s 12-month low. Meanwhile, inflationary pressures eased, according to local firms, but it is worth noting that they remain more marked in Northern Ireland than in any other UK region.”

The headline seasonally adjusted Business Activity Index fell to 53.9 in August from 56.6 in July. The rate of growth was solid and output has now risen in Northern Ireland in each of the past 23 months, but the latest month signalled the weakest expansion since April.

The increase in output in Northern Ireland was also slower than the UK average. All four monitored sectors saw activity rise, although manufacturing was the only one to record a faster rate of expansion than in July.

Concluding, Richard stated: “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.”

Further PMI material including a chart pack, podcast and infographics are available at www.ulstereconomix.com

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