Thursday 27 October 2016

Data shows industrial production downturn

Industrial production fell in May compared with the same period last year, data shows.

Production for manufacturing industries was 7.8pc lower in May compared with April, but also 4.4pc down on May of last year, according to data from the Central Statistics Office.

This was the first annual decline of the year.

Alan McQuaid of Merrion Stockbrokers struck an upbeat tone, however. He said a strong performance for the sector was expected this year as a whole.

"After a sluggish start to the year, we expect the global economy to pick up speed in the coming months.

"Demand for Irish goods in general should increase as a result, with currency developments - particularly in relation to the dollar and pound - a huge plus," Mr McQuaid said.


"Ireland is better placed than most to take advantage of an upturn in the world economy, with the manufacturing purchasing managers' index in expansionary territory for more than two years running up to June."

The CSO data showed that the so-called modern sector - which is made up of a number of high technology and chemical companies - showed a monthly decrease in production for May of 12.2pc and was down 13.2pc compared with the same period last year. There was a monthly increase of 0.6pc in the more employment-intensive 'traditional' sector, and was up 10.6pc on the year.

"Following last year's impressive increase of just over 24pc, a further strong showing in Irish manufacturing output is forecast for this year," Mr McQuaid added.

"We expect another robust double-digit increase, which at this stage now looks like being in the 15-20pc range."

Separate data last week showed that manufacturing growth in Ireland eased to its slowest last month in more than 18 months.

The softness appears to be coming from domestic clients, as export orders continued to rise strongly, slowing just fractionally over the previous month.

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