A softer reduction in order book volumes contributed to the uplift. In fact, the latest fall in new orders was the weakest in the current eight-month sequence of decline, and eased markedly from December’s 31-month record.
Irish goods producers reportedly cut output to adjust for weak demand conditions and subsequently, for the seventh time in eight months, Irish production volumes contracted in January. January survey data again displayed evidence of spare capacity in Ireland’s manufacturing sector. Against a backdrop of subdued demand, firms focused on working through existing orders and building up stocks of finished products. There was a reduction in backlogs for a ninth month in a row, and one that was sharp overall and the steepest since June 2020. Meanwhile, post-production inventories accumulated for the seventh successive month and at the second fastest pace in survey history.
Another advancement came from a renewed improvement in vendor performance. The latest improvement was the most pronounced since July 2013, and followed a 38-month sequence of consecutive deterioration.