Ireland: Irish Manufacturing PMI drops marginally in September
October 3, 2016
The Investec Manufacturing Purchasing Managers’ Index (PMI) edged down from 51.7 in August to 51.3 in September. The PMI still remains above the 50-threshold that separates expansion from contraction in the manufacturing sector, where it has been for 40 consecutive months.
September’s reading mainly reflected growth in new orders, albeit at a slower pace compared to the previous month. This was supported by improved demand from the overseas market and contributed to a rise in manufacturing output. Backlogs of work declined as Irish manufacturers used spare resources to work on existing orders. Employment growth stagnated in September, putting an end to a 39-month streak of job creation. The flat growth in staffing reflected a subdued volume of new orders and the non-replacement of departing staff. Regarding price developments, input and output prices rose, with the latter increasing at the fastest rate since September 2012 due to the pass-through effect of higher input prices and improving pricing power.
The survey report stated, “all in all, [this] does little to change our narrative from the previous month, namely that working capital management (joined in September by a more cautious approach to hiring) points to well-founded caution on the part of Irish manufacturers as we head into the year end.”