Irish manufacturing avoids external risks

There's good economic news for Ireland and the Euro zone today

Irish manufacturing avoids external risks

William Murphy, Flickr

New data suggests that both Ireland and Euro zone manufacturing have had strong starts to 2017.

The latest Investec Manufacturing PMI Ireland shows the headline index was at 55.5 in January - that's down from 55.7 in December, but still well-above the 50 mark, which means that the sector is growing.

The report highlights that the New Orders component has recorded its sharpest upswing since July of 2015.

Businesses reported higher demand from existing clients and a boost in new customers. It adds that a number of clients experienced an increase in orders from the UK - despite the weakening of sterling values.

Philip O’Sullivan Investec's Chief Economist commented: "Another new addition to the PMI this month is the Future Output index. While the rate of optimism implied by this moderated slightly in January, with more than 90% of firms expecting to see output levels either being maintained or increased over the coming year, it is clear that sentiment on the whole remains positive."

The bigger picture

Factories across the Euro zone have seen there activity grow at the fastest rate in six years during the month.

IHS Markit's final manufacturing Purchasing Managers' Index rose to 55.2 - that's up from 54.9 in the previous month.

Meanwhile a sub-index for future orders rose from 63.7 to 66.9.

"Optimism about the year ahead has risen to the highest since the region's debt crisis, suggesting companies are maintaining a buoyant mood despite the heightened political uncertainty caused by Brexit and looming general elections in the Netherlands, France and Germany," chief business economist at IHS Markit Chris Williamson commented.