Ireland: Irish Manufacturing PMI drops in July
August 1, 2017
The Investec Manufacturing Purchasing Managers’ Index (PMI) edged down from June’s almost two-year high of 56.0 to 54.6 in July. Despite the drop, the indicator remains above the 50-threshold that separates expansion from contraction in the manufacturing sector, where it has been for over the past four years.
July’s print reflects a sharp increase in new orders and output. The increase in new orders was buttressed by increased demand from new and existing clients. In turn, new orders supported an increase in manufacturing output for the twelfth consecutive month. Higher new orders resulted in an accumulation of backlogs of work and firms increased staffing to meet higher production requirements. Regarding price developments, input costs rose albeit at the softest pace this year and output prices increased as manufacturers passed on higher costs to consumers.
Assessing the latest one-year outlook reading among Irish manufacturers, Chief Economist Philip O’Sullivan commented that, “looking forward, manufacturers remained positive on the outlook with this optimism linked to expectations of further growth in both domestic and international orders. […] Following a strong performance by the manufacturing sector in H1 this year, and the generally improving global backdrop, we also remain upbeat about prospects for the sector over the remainder of the year.”