Ireland PMI December 2019

Ireland

Ireland: Manufacturing PMI ticks down in December

January 2, 2020

Business conditions in the Irish manufacturing sector continued to deteriorate in December, albeit the downturn was mild. The AIB manufacturing Purchasing Managers’ Index (PMI) ticked down to 49.5 in December from 49.7 in November, thus moving further below the 50-threshold that indicates a deterioration in manufacturing business conditions.

December’s fall largely reflected a drop in output and new orders. Production fell at a sharper clip in December amid increasing stock levels among firms. Meanwhile, the volume of new orders contracted in December, reflecting weak exports to the UK market; however, the rate of contraction was mild. Consequently, firms cut staffing levels for the second consecutive month in December. That said, the pace of job shedding was marginal and moderated from the previous month. On the price front, a stronger sterling relative to the euro increased firms’ cost burdens; nevertheless, the rate of input cost inflation slowed to the second-weakest since 2016. Meanwhile, output charge inflation was broadly stable in December. Lastly, firms’ expectations for production were more upbeat in December, marking the highest level of confidence in six months, amid improving global demand.

FocusEconomics Consensus Forecast panelists expect fixed investment to contract -4.2% in 2020, which is down 1.9 percentage points from last month’s forecast. For 2021, the panel sees fixed investment growth rising to 3.2%.


Author:, Economist

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Ireland PMI Chart


Ireland Manufacturing PMI December 2019

Note: Markit Purchasing Managers’ Index. Readings above 50 indicate an overall increase compared to the previous month, and below 50 an overall decrease.
Source: IHS Markit, AIB


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