Economics: EU considering dual certification for goods produced in Northern Ireland

Media reports suggest European Union officials are considering a dual certification system so that goods produced in Northern Ireland will be able to circulate freely in both the EU and UK markets.
Another proposal is that goods moving from Britain to Northern Ireland could be checked at Dublin Port for EU customs and regulatory compliance before continuing on northwards, as a way of limiting checks and controls at British ports.
Both ideas are among a range of possibilities that the EU Task Force is considering as part of the ongoing effort to “de-dramatise” the backstop.
If the Irish backstop to avoid a hard border on the island of Ireland comes into effect, then customs and regulatory checks would have to be carried out on goods moving from Britain to Northern Ireland, because those goods would then be able to circulate freely throughout the EU’s single market, due to the lack of land border.
Under a dual certification scheme, goods produced in Northern Ireland would be deemed compliant with both EU and UK standards, so that they could move freely through the island of Ireland and beyond to the single market, and throughout the UK.

Economics: Latest Irish consumer prices data likely to see annual inflation rate push above 1.0%

The domestic economic focus on Thursday turns to the consumer price index for September, which will be released by the Central Statistics Office later this morning.

The annual inflation rate came in at 0.7% in August, down marginally from 0.8% in July, which was the highest rate since April last year. Prices were up 0.3% in the month, compared with a monthly increase of 0.4% in July.

Meanwhile, the HICP rate, the measure used for EU comparative purposes, was also up 0.3% in the month, giving an annual inflation rate on this basis of 0.9%, down from 1.0% in July, which was the highest inflation rate in five years or so.

The main monthly changes affecting the CPI in August were increases in the cost of clothing and footwear, following the ending of the traditional Summer sales. Rents were also up in the month as was the price of electricity and gas.

Ireland’s average inflation rate was 0.4% in 2017, up from 0% in 2016. Although the average for the first half of 2018 was only 0.2%, the average for the year as a whole should pick up to around 0.7%.

As regards September, base effects are forecast to push the annual inflation rate up above 1.0%, to 1.3%.

Alan McQuaid (11/10/18)
Economist