The price pressures facing industry on international markets have been confirmed by the latest wholesale price figures. They showed that output prices from manufacturing in April were 7.5 per cent down on one year earlier, writes Cliff Taylor, Economics Editor

The figures showed that the main difficulties face firms selling on export markets, where prices are under pressure due to the strength of the euro and to demands placed on many firms acting as sub-suppliers to overseas manufacturers to sell goods at lower prices.

Export prices were 10 per cent lower in April than the same month last year, according to the Central Statistics Office figures, while the output price for goods being sold on the home market were up 1.4 per cent on the year.

The monthly breakdown of the figures showed that overall manufacturing output prices rose fractionally, by 0.1 per cent in April, compared to the previous month. However, a sustained lift in prices is not in prospect unless the euro falls back, or demand improves strongly on international markets. Prices in the first three months of this year were 3 per cent lower than the previous quarter.

The biggest sectoral contributors to the annual fall in manufacturing output prices were office machinery and computers - where prices fell 19.6 per cent as big US firms converted dollar revenues into falling euro receipts - basic metals (-15.4 per cent) and fish and fish products (-11.9 per cent).

The Central Bank's nominal trade-weighted competitiveness indicator - designed to measure the value of the euro weighted to take account of trade patterns - illustrated the impact of the rising euro on exporters. The index stood at 103.11 yesterday, more than 10 per cent above its level one year ago.