Irish manufacturers recorded a sustained rise in production volumes in February, with growth accelerating to its fastest for 12 months, AIB has said.
The AIB Irish manufacturing purchasing managers’ index (PMI) rose to 51.9 from a reading of 51.3 for the previous month, said the bank.
The Irish manufacturing PMI remains above the flash February readings for the euro zone, US and UK at 47.3, 51.6 and 46.4, respectively.
A reading above 50 indicates that activity is growing.
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The latest increase in total new work was the fastest recorded since May 2022, which helped to support another expansion of staffing numbers, for a third straight month, and a renewed upturn in purchasing activity.
However, input cost inflation intensified as suppliers sought to pass on rising raw material prices and greater salary payments.
“Output rose robustly in February, amid a general improvement in demand conditions. This was reflected in accelerated growth in new orders, but respondents did note continued softness in external demand,” said David McNamara, chief economist at AIB.
“This weakness was evident in stagnant export orders, with subdued European demand cited. Hiring expanded in February, albeit at a slower pace than last month, as firms planned for higher expected output.”
The rate of inflation for input and output costs remained heightened in February.
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“Respondents noted a general uplift in input prices, linked to raw materials and energy costs,” said Mr McNamara. “On the output side, prices rose at the fastest pace since September 2024, as firms sought to protect margins.”
Export sales stabilised in February, which ended a twelve-month period of contraction, according to Mr McNamara. Manufacturers typically noted a boost from rising sales to US clients, but this was offset by reports of weak demand across the UK and euro area.
Irish manufacturers maintained a generally upbeat assessment of the outlook for activity levels over the coming year, in spite of growing concerns about global trade.
US president Donald Trump signalled last he will impose a 25 per cent tariff on EU goods. Ireland exports €75 billion of goods to the US annual, of which €58 billion is manufactured by drug companies.
