Northern Ireland’s businesses have reported a record hike in input costs and selling prices in a further sign of inflationary pressures across the economy.
The latest Purchasing Managers Index report from Ulster Bank also showed the province’s companies are continuing to grow and, encouragingly, business owners are increasingly confident about maintaining the trend in the coming months.
From a sector perspective, manufacturing and services performed strongly in the reference month of August while construction and retail saw activity and employment fall and both sectors remain pessimistic about output a year ahead.
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Meanwhile, businesses reported the first drop in new orders for six months.
The headline seasonally adjusted Business Activity Index posted 54.0 in September, up from 52.1 in August to signal a solid and accelerated rise in output at the end of the third quarter.
The report said some firms indicated that they continued to catch up on work following the easing of COVID-19 restrictions.
But it is the broad and sustained price rises which are causing the most concern for businesses.
“Inflationary pressures are intensifying; local firms reported record rises in input costs and are also raising the prices of their goods and services at the fastest pace in the survey’s history,” Richard Ramsey, Chief Economist at Ulster Bank in Northern Ireland, said. “And this reflects the experience of businesses last month, before the more recent surge in energy prices took place.”
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Also of concern are continued delays to deliveries, Mr Ramsey said.
“Supply chains remain under stress, with supplier delivery times lengthening significantly in September relative to August. This is most acute within retail, and this will present challenges for consumers and business, particularly as we approach Christmas.”