Irish manufacturing growth rate slips to 16-month low

Irish manufacturing expanded at its slowest rate in 16 months in June with growth easing in both new orders and employment, a survey showed on Wednesday.

Ireland was the fastest growing economy in the European Union last year and most economic indicators have been positive this year, although annual growth in retail sales and house prices both weakened in May.

The Investec Manufacturing Purchasing Managers' Index fell to 54.6 in June from 57.1 in May, down from a 15-year high of 57.5 in February.

The index has held above the 50 line denoting growth since May 2013, when Ireland was in an international bailout programme.

“Overall, while most of the indices point to a slower finish to Q2, our sense is that activity levels for Irish manufacturing firms are likely to pick up again in Q3, assuming that the fallout from Greece is contained,” said Investec Ireland chief economist Philip O’Sullivan.

The PMI subindex for new orders slipped to 55.2 in June from 59.2 in May, its lowest level in 16 months. But new export orders, supported by a weak euro, fell only marginally.

“With the new export orders index little changed on the previous month, it appears that the softness in the (new orders) index may be emanating more from domestic clients,” O’Sullivan said.

Reuters