Manufacturing sector grows at slowest pace in nine months

Sat, Feb 2, 2013, 00:00

Ireland’s manufacturing sector continued to grow in January, but at the slowest pace in nine months, a new survey showed yesterday.

NCB Stockbrokers survey purchasing managers in manufacturing companies each month to gauge activity in the sector. The survey index stood at 50.3 in January, marginally above the 50 mark that separates expansion from contraction. That compares with a reading of 51.4 in December.

The survey noted output remains in positive territory, and at 51.5 was slightly ahead of December’s 51.2 reading.

One sub-index in the survey showed that new export orders grew for a fourth successive month, registering 50.9, but total new orders shrank as weakening client demand snapped a run of growth that had lasted for 11 months.

The employment category also turned negative, contracting to 49.6 after growing for 10 months in a row.

Sluggish start

“Tying it all together, while the headline PMI reading, at 50.3, points to an 11th successive month of growth, today’s release points to a sluggish start to 2013 for the manufacturing sector,” said NCB chief economist Philip O’Sullivan.

Separate figures from the EU’s statistics agency, Eurostat, showed that euro zone unemployment remained at 11.7 per cent in December, unchanged on a month earlier.

Other Eurostat figures showed that the annual rate of consumer price inflation across the euro zone fell to 2 per cent in January.

The reading, Eurostat’s first estimate, was lower than the 2.2 per cent level forecast by economists polled by Reuters.

Inflation is now near the European Central Bank’s target of “close to, but below 2 per cent”, and along with record unemployment, gives the ECB room to cut interest rates to stimulate the economy.– (Additional reporting: Reuters)