Manufacturing up in November
Irish manufacturing activity grew for a ninth straight month in November, and at the fastest pace since July, according to the latest NCB Manufacturing Purchasing Managers Index published yesterday.
The State’s services sector grew at the fastest pace in five years in October amid rising orders and output, which led to Ireland being the only euro zone country to show manufacturing growth that month.
The seasonally-adjusted index climbed to 52.4 in November from 52.1 a month earlier. Any measure over 50 signals growth.
New export orders also increased for the second month in a row and now stand at 52.1. This has been supported by new product launches and order wins from the likes of China, the US and the UK during the month.
New orders rose to 51.9, helping employment levels.
One headwind for firms is the mismatch between input prices (59.0), which are experiencing upward pressure from energy costs, and output prices (49.7), which slipped back into negative territory after improving in the previous two months, according to NCB.
“The positive trends we have noted for some time have continued into November,” said Philip O’Sullivan, chief economist at NCB Stockbrokers.
“New export orders are in positive territory for a second month in a row. This has been supported by new product launches and order wins from the likes of China, the US and the UK.”
Euro area manufacturing contracted in November while factory output rose in China, Russia and the US, underscoring the divergence of the global economic recovery.
Manufacturing output in the 17-nation euro area shrank for a 16th month, with a gauge of manufacturing rising to 46.2 from 45.4 in October. In China the Purchasing Managers’ Index climbed 50.6 and in Russia it expanded for a 14th month.
Rising demand from domestic and foreign customers helped US manufacturing grow in November at its quickest pace in six months, a Markit survey showed. Markit said its US Manufacturing Purchasing Managers Index rose to 52.8 last month, rebounding from a more than three-year low of 51.0 in October.
Firms said Hurricane Sandy, which hit in late October, was partly responsible for a jump in domestic new orders, suggesting the pace of growth could slow in the months ahead.
“Manufacturing looks likely to provide only a modest contribution at best to economic growth in the final quarter of the year and, alongside signs of renewed weakness in consumer spending, suggests that US growth will have slowed markedly from the 2.7 per cent pace seen in the third quarter,” Markit chief economist Chris Williamson said. – Additional reporting: Bloomberg