Ireland: Manufacturing PMI rises in May
The AIB manufacturing Purchasing Managers’ Index (PMI) rose from its over one-decade low of 36.0 in April to 39.2 in May. Consequently, the reading inched closer to, but still remained well below, the 50-threshold that indicates a deterioration in manufacturing business conditions compared with the previous month.
May’s result largely reflected more modest downturns in production and new orders compared to April amid continued subdued demand due to lockdown measures. Although firms’ job shedding slowed slightly, it still logged the second-quickest rate in over a decade. On the price front, input cost inflation eased in May, while output price inflation fell at the fastest clip since July 2019. Lastly, firms’ outlook for future output improved in May, with the index rising to a three-month high. That said, the strength of confidence remained historically muted, however.
Commenting on the reading, Oliver Mangan, AIB Chief Economist, noted:
“The Irish data are in line with global trends. The flash readings for the Eurozone, UK and US manufacturing PMIs also saw modest rises in their May headline indices to 39.5, 40.6 and 39.8, respectively, very similar to Ireland. The indices should continue to move higher as lockdown restrictions are eased and economic activity picks up again.”