Northern Ireland

Danske Bank upgrades NI growth forecast

Danske Bank in Belfast
Image caption Danske Bank is one of the 'big four' banks which dominate the Northern Ireland economy

Danske Bank has upgraded its growth forecast for Northern Ireland as the economy has performed better than it expected following the EU referendum.

The bank now expects growth of 0.8% this year, compared to the previous forecast of 0.5%.

However that is still below the 1.5% growth estimated for 2016, which was the strongest performance since 2007.

Many economists have revised their short term forecasts in the wake of the Brexit vote.

'Performed robustly'

Danske Bank economist Conor Lambe, said: "The post-referendum picture is still emerging and will continue to do so over the coming quarters.

"We have revised our forecast up slightly from the last quarterly forecast as the economy has performed better than expected following the outcome of the EU referendum."

However, Mr Lambe warned of a number of downside risks that could lead to lower growth.

He pointed to a weaker outlook for consumer demand, meaning "we might see a slight deterioration in the labour market over the short-term".

The UK economy has performed robustly in the wake of the Brexit vote.

'More optimistic'

Earlier this month, the Bank of England made another dramatic upward revision in its growth forecast for this year.

It expects the economy to grow 2% in 2017, up from a November forecast of 1.4%, which was itself an upgrade from the 0.8% forecast made in August.

The bank said the latest, improved forecast was partly the result of higher spending and investment contained in Chancellor Philip Hammond's Autumn Statement.

It also credited stronger growth in the US and Europe, rising stock markets and the greater availability of credit for households, for its more optimistic outlook for the UK economy.

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