Factory activity grew for a second month in a row in February on strong output and orders, a survey showed today.
But concerns about coronavirus and a domestic political stalemate tempered expectations for future growth.
A six-year expansion in manufacturing came to an end in June as a slowdown in global trade and uncertainty over Brexit finally caught up with manufacturers in the European Union's fastest-growing economy.
Activity has only expanded in three of the nine months since.
The AIB IHS Markit manufacturing Purchasing Managers' Index (PMI) slipped to 51.2 in February from January's 51.4.
But the index stayed above the 50 mark that separates expansion from contraction.
The sub-indices measuring output and new orders were both higher in February than the previous month, though the employment gauge slipped back into contraction territory.
The future output sub-index, which measures expectations of output over the next 12 months eased notably to 66.5 from 72.3 with firms mentioning political uncertainty in Ireland and coronavirus-related disruptions.
Politicians have warned it could be weeks or even months before the country's parties form a new government after the February 8 election ended in a near tie between all three of the largest parties.
"Despite significant headwinds in February, Irish manufacturing managed to maintain its positive start to 2020," AIB Chief Economist Oliver Mangan said.
"The PMI data show, though, that the sector is facing a number of challenges and firms are cautious as evidenced by falls in employment, inventories and sentiment," he added.