Manufacturing area growth weakens

Growth in the manufacturing sector weakened in February as costs rose strongly, according to the latest NCB Purchasing Managers' Index (PMI).

The survey of conditions in manufacturing points to an improvement in business conditions last month, but shows that the pace of the improvement has slowed.

NCB senior economist Eunan King said this trend appeared to mirror developments in the wider euro-zone area over the same period.

A wider euro-zone PMI, also released yesterday, showed that growth in the European manufacturing sector held steady in February.

It also suggested, however, that expansion could be losing momentum on the back of renewed euro strength.

The NTC Research euro zone Purchasing Managers' Index, based on a survey of around 3,000 companies, was unchanged from January at 51.9. A reading above 50 signals expansion.

The Irish manufacturing index meanwhile delivered a reading of 51.8 for February, down from 52.9 in the previous month.

Survey respondents reported input price pressures that were stemming primarily from the rising cost of industrial raw materials.

Steel and plastics prices were cited as weighing particularly heavily on the sector.

Manufacturers said they had managed to pass on just a portion of the higher input costs to their customers.

More positive in the sector last month was the employment picture, with respondent firms reporting the recruitment of extra staff to meet demand.