The headline Purchasing Managers’ Index (PMI) remained above the 50 mark for the fourth straight month at 50.8, indicating ongoing improvement in operating conditions. However, this was down from February’s recent high of 52.1, suggesting that growth moderated, even though it remained one of the stronger readings in recent months.

Production, new orders, and employment all increased during March. Higher demand, new customers, business expansion efforts, and competitive pricing supported the rise in new orders, although growth eased from February’s peak. Export orders also grew, but at a slower rate.

Manufacturers reported a further rise in backlogs of work, as output growth did not keep up with incoming demand. In response, companies continued hiring, marking the third consecutive month of job creation—the longest stretch since mid-2021. Purchasing activity also increased, though at a slower pace compared to February.

At the same time, supply chain pressures intensified. Delivery times lengthened for the first time in five months and at the fastest rate in over three years, with firms citing disruptions, rising input costs, and supplier capacity constraints.

Inflationary pressures picked up significantly, with both input and output prices rising at their fastest pace since early 2022. This reflects higher raw material costs and ongoing volatility in supply conditions.

Despite these challenges, manufacturers remained optimistic about the year ahead. While confidence eased slightly from February, it stayed relatively strong, supported by expectations of improved demand, investment in capacity and new products, efficiency gains, and supportive government policies.