NI economy 'making weak recovery'

http://news.bbc.co.uk/go/rss/-/1/hi/northern_ireland/8219371.stm

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The Northern Ireland economy has begun to experience a weak recovery, according to the Northern Bank.

The bank's "Quarterly Sectoral Forecasts" report said the majority of business sectors in NI were now experiencing improvements in activity.

Its chief economist, Angela McGowan, said that although growth forecasts were small, it indicated that the worst of the recession was over.

Ms McGowan said the road to recovery would be challenging.

"We will have to wait until next year for positive year-on-year growth, which we estimate will be 0.3% on average in 2010," she said.

"However, the overall health of the local economy in quarter three this year is encouraging, with signs of incremental improvements.

"Of course, for many people and businesses this news will be of little comfort as many have lost their jobs and will feel the impact of the recession for some time.

"Unfortunately, improvements in economic activity will not deter further job cuts in the months ahead and the labour market is expected to continue contracting even when economic activity picks up."

Confidence

On Monday a survey of chartered accountants across England, Wales and Scotland pointed to a surge in business confidence suggesting the recession is at an end.

The Institute of Chartered Accountants' index of business confidence rose to 4.8 at the end of June, from -28.2 in March, the biggest rise for two years.

However, chief executive Michael Izza warned against "underestimating" the challenges ahead for businesses.

The institute predicts the UK economy will grow by 0.5% in the third quarter of 2009.

Its forecast comes after the economy shrank by 0.8% in the second quarter of the year.

Investor confidence about the UK economy also appears to be growing, with the UK's main FTSE 100 share index ending Monday trading at a 10-month high of 4,896, up 0.9% on the day.

However, policymakers have been wary of stoking expectations that the UK's economic woes are over.

"The pace of recovery over the next few years is highly uncertain," said Bank of England Governor Mervyn King.