Ireland's manufacturing sector recorded its sharpest improvement in business conditions since July 2025 in February, with the AIB Ireland Manufacturing PMI rising to 53.1 from 52.2 in January, according to a Business Plus report.

Any PMI reading above 50.0 indicates overall sector improvement. The February figure reflects accelerated growth across output, new orders and employment, with export markets driving order book expansion for the first time in three months and at the fastest rate since March 2025.

Manufacturers reported stronger order intakes from clients in Asia, the United Kingdom and the United States.

Job creation reached its fastest pace since June 2022, while backlogs declined for the third consecutive month. Vendor performance deteriorated for the tenth month running, with delivery times lengthening to their greatest extent since November 2022 due to shipping delays, depleted inventories and supplier staffing shortages.

David McNamara, chief economist at AIB, said: "The Manufacturing PMI has now signalled growth in each month since the beginning of 2025. The expansion in February was due to sustained gains in output, new orders and employment. The Irish manufacturing PMI remains above the flash February readings for the Eurozone, US and UK at 50.8, 51.2 and 52.0, respectively."

McNamara noted that input cost inflation accelerated sharply in February to its highest level since January 2023, with some raw material costs rising materially. Firms were able to increase output prices to partially protect margins, though competitive pressures limited the extent to which cost increases could be passed on.

Looking ahead, approximately 46 per cent of manufacturers surveyed predicted an increase in output over the course of 2026, with only seven per cent forecasting a decline.

Dig into the full February PMI data and sector outlook in the complete report.