Ireland’s manufacturing sector grows in June
Investec’s PMI report shows expansion will continue on the back of stronger growth in export markets
New orders received were the best seen in 2018 so far, with higher growth from both domestic and overseas customers. Photograph: Robbie Reynolds
Ireland’s manufacturing sector continued to expand in June, in a strong finish to the second quarter, driven by higher demand.
According to the latest Investec Manufacturing PMI Ireland report, the headline PMI rose to 56.6 in June, a five month high, from May’s 55.4 reading, amid higher client demand. A figure above 50 denotes growth.
Growth is expected to continue, with the forward-looking future output index remaining very elevated, with around 55 per cent of firms expecting to see a rise in production over the coming year, with this assessment based on the anticipation of stronger growth in export markets in particular.
“With global growth expected to remain close to 4 per cent per annum into the medium term, we think this optimism is well founded,” said Philip O’Sullivan, an economist with Investec.
Overall, new orders received were the best seen in 2018 so far, with higher growth from both domestic and overseas customers, and higher demand seen from the likes of India, Russia, the US and UK.
There was also an uptick in both the quantity of purchases and employment indices, a further rise in backlogs of work (the 14th in as many months) was recorded, while stocks of finished goods were depleted for a fourth successive month as firms used inventories to try to meet client orders.
The survey also points to signs of pressure on the margin side, with input costs increasing at a marked pace due in the main to higher raw materials prices (aluminium, steel, oil, plastics and timber were all cited by panellists).