Ireland: Manufacturing PMI accelerates in December and confirms strength of Irish economy
January 4, 2016
The Investec Manufacturing Purchasing Managers’ Index (PMI) rose from 53.3 in November to 54.2 in December, which marked the strongest expansion since July 2015. The PMI remains comfortably above the 50-threshold that indicates expansion in the manufacturing sector, where it has been for 31 consecutive months.
December’s result mainly reflected a strong rise in new orders that tallied its 30th consecutive increase and the strongest expansion since July 2015. New export business grew sharply in December as the weakness of the euro helped Irish firms secure new work from the UK. With higher new orders, backlogs of work rose for the first time in five months. Given the increase of new orders and outstanding business, manufacturers upped their production levels in December and led to a surge in employment and purchasing activity.
According to the survey report, “A key highlight of today’s report is the New Orders segment, where the rate of expansion quickened to its fastest pace since July. Some panellists reported that their clients had made advance orders for 2016. The New Export Orders segment points to substantial growth in overseas demand, with respondents attributing some of this to euro weakness, which helped to secure more work from the UK in particular. […] Input costs dropped for a third consecutive month, resulting from lower prices for energy and raw materials. In spite of lower input costs, output prices rose marginally in November for the first time in six months. Suppliers’ delivery time lengthened in November and purchasing activity rose fractionally on expectations of decelerating demand.”