Irish exports hit 18-month high as economy brightens

Mon Jul 14, 2014 8:12am EDT

* Exports jump 15 pct mth/mth in May, rise 11 pct yr/yr

* Impact of patent expiry on drugs exports fading

* Separate data shows continued recovery in construction

DUBLIN, July 14 (Reuters) - Irish exports rose by 15 percent month-on-month in May to reach their highest level in 18 months, adding to recent data that points to a broadening economic recovery.

Ireland's economy grew by 2.7 percent in the first quarter of the year, recovering from a disappointing end to 2013 as improving employment figures began to feed through and exports recovered from a slump.

Exports, which held up during much of Ireland's financial crisis, struggled last year due to the mixed economic picture in Europe and the expiry of patents among the large cluster of drugs companies located in the country.

Goods exports rose to 7.9 billion euros ($10.8 billion) on a seasonally adjusted basis in May, the Central Statistics Agency said on Monday, and were driven by pharmaceutical goods as the impact of the so-called "patent cliff" appeared to be easing.

Exports rose 11 percent in May from a year earlier, the data showed.

Separate data on Monday also showed continued recovery in the battered Irish construction sector as the Ulster Bank Purchasing Managers' Index (PMI) of activity stayed well above the 50 point line denoting growth for the 10th successive month.

Ireland's government is targeting economic growth of 2.1 percent this year. Economists polled by Reuters are a touch more positive and are forecasting a 2.3 percent expansion.

"The recovery that we're seeing in the U.S., the UK, even in the euro zone, where at least there is growth, really just underpins a very much improving story around the Irish economy," Investec's Ireland chief economist Philip O'Sullivan said.

"With all three PMIs for Ireland simultaneously above 50 for 10 months now, that suggests there is a very broad recovery taking place right across the Irish private sector," he said, referring to PMI surveys for the construction, manufacturing and services sectors. ($1 = 0.7331 euros) (Reporting by Padraic Halpin; Editing by Susan Fenton)