Manufacturing conditions stabilise in November

December 2, 2023

Business conditions in the manufacturing sector stabilised in November, new figures show.

The latest Purchasing Managers Index from AIB reveals the second highest reading since February.

The index rose to 50 from 48.2 in October, and 49.6 in September.

Readings above 50 indicate overall growth in activity.

Marginal increases in output and orders combined with a modest rise in employment were the key features of the November PMI data.

“Output rose fractionally following eight months of declines,” Oliver Mangan, AIB Chief Economist explained.

“Similarly, new orders edged slightly higher having fallen for most of the last eighteen months.

“Export orders, though, decreased again in November, with firms reporting continued subdued demand conditions in overseas markets. Meanwhile, employment rose modestly for a fifth consecutive month,” he added.

Mr Mangan said firms reported deliberate inventory reduction strategies against a backdrop of fewer supply bottlenecks and subdued customer demand.

“This was reflected in marked falls in stocks of both inputs and finished goods, with the latter declining at the sharpest pace in nearly two years.

“Meanwhile, input prices fell slightly in November, helped by lower raw material costs,” he added.

He said this allowed manufacturers to continue to cut factory gate prices, which eased for the seventh month in a row.

However, the data shows that the degree of business optimism eased to its lowest since July.

Anecdotal evidence suggested that concerns about the broader economic outlook at home and abroad had dampened business confidence during November.

The Irish PMI remains well above elsewhere in Europe.

The flash manufacturing PMI readings in the Eurozone and UK remained weak in November, though they were up slightly at 43.8 and 46.7, respectively.

Meanwhile, the flash US index came in at 49.4 in November.

Article Source – Manufacturing conditions stabilise in November – Euroconstruct – RTE

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