The seasonally-adjusted volume of total industrial output for the three month period May to July 2007 was down 0.2% compared to the preceding three month period.
However, on an annual basis, total industrial output in July was 14% higher than in the same month last year, while production in manufacturing was up 14.5%.
In the first seven months of 2007, industrial output was 7.7% higher on average than in January-June 2006 while the increase for manufacturing was 8.2% over the same period.
IBEC Chief Economist David Croughan said the turnaround was almost entirely due to a positive swing in the output of the chemicals sector, which recorded an annual increase of 34.4% in July.
He said the output of office machinery and computers recorded virtually no growth in July, following strong growth in the second quarter.
Last year industrial output posted an average volume increase of 5%, its best performance since 2002 while manufacturing production in 2006 was up 5.2% on the previous year.
The 'Modern' sector, comprising a number of high-technology and chemical industries, showed a year-on-year rise in production for July of 20.5%, while an annual increase of 1.5% was recorded in the 'Traditional' sector.
Within the 'Modern' sector, the chemicals and ICT sub-sectors have accounted for most of the output growth in the year to date.
Economist with Bloxham Stockbrokers, Alan McQuaid, pointed out that output developments in this sub-sector tend to be volatile, given that the sector comprises a small number of large companies, so that developments in any single firm can have a significant impact .
'Assuming no adverse shocks or significant losses in competitiveness over the next few months, the manufacturing sector is now forecast to post an average volume increase this year of 7%', Mr Quaid forecast.
A slight weakening in global demand should lead to a lower annual average increase in output in 2008, of around 5%, he said.
