Manufacturing growth slowed to a 16-month low in June as new orders contracted in the face of rising prices, a survey showed today.

The AIB S&P Global manufacturing Purchasing Managers' Index (PMI) fell to 53.1 in June from 56.4 in May.

That was down from an all-time high of 64.1 in May last year.

New orders decreased for the first time since February last year as steep inflationary pressures dampened demand, AIB said.

New export orders contracted at their steepest pace since May 2020, it added.

"The marked softening in business conditions in Irish manufacturing was led by the first declines in new orders and output since early 2021, reflecting the increasingly negative impact of rising inflation on demand," AIB's chief economist Oliver Mangan said.

"There are clear signs that the slowdown in global manufacturing activity is extending to Ireland," he added.