Cold weather saw Northern Ireland business activity decrease at its fastest rate in almost two years.

The December deterioration was partly blamed on extreme temperatures last month with shoppers staying indoors during the crucial pre-Christmas season.

In the report released by Ulster Bank today, its chief economist for Northern Ireland Richard Ramsey said there had been a decline in manufacturing output and new orders.

“The extreme weather conditions that prevailed last month have undoubtedly exaggerated the true underlying business performance within Northern Ireland,” he said.

Its record monthly fall in its business activity index has seen Scotland displace Northern Ireland at the foot of the regional performance table.

This is the first time since February 2009 that Northern Ireland has not posted the sharpest rate of decline in private sector output within the UK.

Mr Ramsey added Northern Ireland’s muted export-led economic recovery could be partly blamed on its exposure to the Republic of Ireland economy. “Inflationary pressures continue to build whilst local firms continue to report falling employment levels as they have done continuously since March 2008,” he said.

However, the pace of job losses eased in the latest quarter relative to the previous quarter.

“This was due to the services and manufacturing sectors as construction saw the pace of job losses accelerate in December at its sharpest rate since March 2009,” Mr Ramsey added.

PA