Production volumes have increased in each month since June 2016, but the rate of expansion eased further from the peak seen at the start of 2017. Some manufacturers suggested that domestic clients had adopted a wait-and-see approach to investment spending. Meanwhile, new export sales increased only marginally in May, which pointed to a sustained drag from subdued external demand.
More cautious inventory policies were recorded across the manufacturing sector, with stocks of purchases falling at the most marked pace since September 2016. This was achieved through a further slowdown in growth of input buying in May. Meanwhile, job creation eased since April and remained only modest.
The latest survey highlighted a sharp slowdown in input price inflation from the 31-month peak seen during April. Moreover, the latest rise in input costs was the least marked since November 2016. Softer cost pressures resulted in the weakest increase in factory gate prices for three months in May.