Irish manufacturing growth rebounded to a four-month high in October but growth in new export orders slowed as the country continued to feel the impact of Britain’s vote to leave the EU, a survey showed on Tuesday.
The Investec Manufacturing Purchasing Managers’ Index (PMI) climbed to 52.1 in October from 51.3 in September, remaining above the 50 mark that separates expansion from contraction for the 41st consecutive month.
The consumer goods sector posted the sharpest expansion in production during the month.
While new orders improved to a seven-month high, growth in new export orders was slower than in September with panellists reporting that sterling weakness had made securing new work in the UK more difficult.
Employment rose marginally after failing to grow in September for the first time since May 2013.
Investec Ireland Chief Economist Philip O’Sullivan said there was little sign that the “well-founded caution” apparent among Irish manufacturers had lifted.
“October’s modest improvement is not enough to make us change that assessment, not least given next week’s U.S. elections, which could have a significant impact on the health of the sector,” O’Sullivan said.
Europe’s fastest-growing economy, Ireland is seen as having more to lose than any other European Union member from Britain’s decision to quit the bloc, which both countries joined 43 years ago. Exporters have been hit by the fall in the value of sterling since June 23’s Brexit vote.
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