Industrial output may signal slowdown

Official figures showing a slowdown in industrial output in August may be further evidence of a potential slowdown in manufacturing following the June 23 vote by the UK to exit the EU.

The CSO said output was down from the previous month 13.7% and from August 2015 8.5%.

The figures however, provide an unclear picture—with the output from the so- called modern side of the economy—which includes the many foreign-owned computer services and pharmaceutical companies based in the country — down sharply, by over 23%, from July, and down by 12.7% from a year earlier.

Meantime, output in the traditional sector, which includes the many Irish-owned firms, posted a small increase in the month, but was almost 3% lower from August 2015.

Many analysts have detailed how the sharp slump in the value of sterling since the UK referendum has raised uncertainty about the profitability of Irish firms in selling goods and services across the Irish Sea.

The Investec Ireland manufacturing survey of Irish purchasing managers index in manufacturing published earlier this week suggested that growth in the industry had appreciably slowed in September.

Its separate survey of Irish services published yesterday showed the sector was still expanding, but at its weakest rate for over three years.

“With further uncertainty around Brexit and the US presidential election expected between now and the year end, we are growing increasingly cautious about the prospects for the fourth quarter,” said Investec Ireland chief economist Philip O’Sullivan.