independent

Monday 21 April 2014

January manufacturing growth slips for first time in year

GROWTH in Ireland's manufacturing sector slipped to a nine-month low in January, as the flow of new orders contracted for the first time in a year, a survey showed.

While the rate of growth in the sector slowed, the economy has now posted growth in manufacturing for 11 consecutive months. That is a significant achievement when much of Europe is in recession. A similar survey in the UK showed growth there also expanded in Janaury.

The NCB Manufacturing Purchasing Managers' Index dropped to 50.3 in January from 51.4 a month earlier, a fraction above the 50pc mark that separates expansion from contraction.

"While output remains in positive territory and new export orders grew for a fourth successive month, other areas showed signs of weakness," said Philip O'Sullivan, chief economist at NCB Stockbrokers.

"Tying it all together... today's release points to a sluggish start to 2013 for the manufacturing sector," he said.

Manufacturing contributes around one quarter of Ireland's gross domestic product, according to World Bank figures.

New orders contracted for the first time in a year, falling to 49.5 from 50.9 in December, while employment contracted for the first time in 11 months.

Input prices grew sharply, while output prices contracted, squeezing manufacturers' margins.

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