Manufacturing conditions improve as output increases

Last month saw the first improvement in Irish manufacturing business conditions since May with a slight rise in output and new orders.

The October reading of 50.7 in the AIB manufacturing purchasing managers' index (PMI) was a marked improvement from the 48.7 recorded a month earlier.

After three months of decline, output expanded marginally and at the fastest pace since April. Inflow of total new orders also picked up. A figure above 50 signals growth.

The increase in overall new business followed five consecutive months of decline. Exports sales continued to fall however, although the decline was less pronounced than in September.

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Employment rose modestly during the month with anecdotal evidence indicating that companies are raising their staffing numbers in response to higher production requirements.

Stocks of finished goods increased for the fifth month running during October while holdings of raw materials and semi-finished items increase for the first time since July.

"Overall, while the improvement in the manufacturing PMI in October is welcome it remains at a weak level, consistent with very modest growth in the sector as the slowdown in the global economy and Brexit uncertainty continue to act as headwinds," said AIB chief economist Oliver Mangan.