Ireland’s manufacturing sector ended 2013 on a positive note as growth of output and new orders gained momentum last month.

Activity grew for the seventh straight month in December and at a faster pace than in November, ending the year on a high following the bailout exit.

Global manufacturing also ended the year on a strong note as major exporters like Japan, Germany and Italy posted their fastest growth in years according to Markit Purchasing Managers’ Indexes (PMIs).

The Investec Purchasing Managers' Index – which measures the health of the Irish manufacturing industry - rose to 53.5 in December from 52.4 in November, climbing further above the 50 line dividing growth from contraction.

Investec Ireland chief economist Philip O’Sullivan said the latest index showed a “solid finish to 2013” for the manufacturing sector.

“Within the data we note a pick-up in the rate of growth in new orders, in spite of the pace of expansion in new export orders slowing for a third successive month.”

New business continued to increase in December, extending the current sequence of growth to six months. Moreover, the rate of expansion picked up from that seen in November.

December data also signalled a sixth successive monthly rise in new export orders at Irish manufacturing firms.

Irish manufacturers continued to raise their staffing levels in December. According to respondents to the Investec survey, the latest increase in employment was in order to support rising production.

Overall, the quantity of purchases component of the index remained above the 50 mark for a fifth successive month in December, with the rate of expansion marginally higher than November’s outturn, while the stocks of purchases component rose above 50 for the second time in the past three months.

“This purchasing behaviour, allied to firms’ continued willingness to add to payrolls and rising new orders, suggests that the positive momentum in the manufacturing sector in H2 2013 is likely to persist into the New Year,” Mr O’Sullivan said.

Meanwhile, euro zone manufacturing grew at the fastest rate since mid-2011 in December on brisk business in Germany and Italy, setting the stage for a solid start to the year after a tumultuous 2013.

Markit’s euro zone PMI rose to 52.7 in December from November’s 51.6, confirming an early estimate and marking its best reading in 31 months.

New orders piled in at the fastest pace since April 2011, and a near two-year stretch of job cuts across euro zone factories almost came to an end last month.

Looking at individual countries in the region, the mood was largely positive, with the exception of France. Manufacturing activity in France hit a six-month low last month.

British manufacturing grew less quickly than expected in December but the sector still looks on track to notch up growth of more than 1 per cent in the fourth quarter.

The Markit/CIPS Manufacturing PMI for Britain eased to 57.3 in December from November’s three-year high of 58.1. However, the average PMI reading for the final three months of the year was the highest since the first quarter of 2011.

"UK manufacturing's strong upsurge continued at the end of 2013, with rates of growth in production and new orders still among the highest in the 22-year PMI survey history," said Markit economist Paul Dobson.

While UK manufacturing has yet to recover to pre-crisis output, Mr Dobson said broad-based growth in the sector should keep the recovery on track going into 2014.

The HSBC/Markit PMI for China slipped to a three-month low of 50.5 in December, consistent with a dip in the official government PMI to a four-month low of 51.

Additional reporting: Reuters