Activity in the manufacturing sector expanded last month at its fastest pace since July 2006, the latest NCB Purchasing Managers' Index has shown.

According to figures released yesterday, the index registered 54.4 in September, fractionally higher than the 54.3 recorded in August, and well above the 50 mark, which indicates no change. The figure has now been above 50 each month for the past four years.

Dermot O'Brien, chief economist at NCB Stockbrokers, described the resilience as heartening in light of less positive indications elsewhere in Europe.

He said the survey showed that growth in manufacturing activity held up well into the autumn, with orders rising at a strong pace and employment gains increasing.

Growth in new orders increased to 56.5 from 56.1, the highest rate in 15 months, with firms suggesting that the strong growth in new orders reflected a an improvement in underlying demand. New business has now risen for 49 consecutive months.

Manufacturers also reported a marked increase in export work, citing higher demand from clients in the UK.

At 54.6, new business from abroad was at its highest rate since June 2006. Activity in this area has now risen for four months in a row, following two months of contraction in April and May.

Employment expanded at a moderate rate for the second consecutive month in September to register 51.5 on the index, compared with 51.2 in August.