July 3, 2017 / 5:12 AM / 2 years ago

One year from Brexit, Irish manufacturing growth hits 23-month high - PMI

DUBLIN (Reuters) - Growth among Irish manufacturers reached a near two-year high in June, a survey showed on Monday, as firms showing few signs of an early hit from Britain’s Brexit vote further added to headcount and built up inventories.

Ireland, the European Union’s fastest-growing economy, is widely seen as the member most at risk from Brexit due to its close trading links with Britain. However, after a muted initial impact, Dublin now sees its economy growing faster in 2017 that it did a year ago when Britons voted to leave the bloc.

Manufacturers continued to back that confidence up with the Investec Purchasing Managers’ index rising to 56.0 in June from 55.9 in May, remaining at the highest level since July 2015 and well above the 50 mark separating growth from contraction.

Employment in the sector, which grew at its fastest pace in two years in May, was strong again in June and firms’ stocks of purchases returned to growth for the first time in 14 months in line with the hiring of new staff.

The Stocks of Purchases sub-index rose to 51.0 from 49.5 in a month earlier.

“While the return to inventory build-up gives a good indication of how firms assess their prospects, the future profitability index further demonstrates this, as it reveals that business sentiment remained strongly positive in June,” Investec Ireland chief economist Philip O’Sullivan said.

“We note that the implied (overall) growth rate quickened over the course of Q2, indicating that the sector exited the period with a strong tailwind behind it.”

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Reporting by Padraic Halpin; Editing by Toby Chopra

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