The index rose to 56.1 in December from 53.6 in November. A figure above 50 indicates growth whereas a figure below signals market contraction. This figure also beat a prediction of 53.1 by economists in a Reuters poll.
The survey found the sector started 2017 on a “strong footing” with a weaker pound boosting overseas orders.
Rob Dobson, senior economist at IHS Markit, commented: "Based on its historical relationship against official manufacturing output data, the survey is signalling a quarterly pace of growth approaching 1.5%, a surprisingly robust pace given the lacklustre start to the year and the uncertainty surrounding the EU referendum.
"The boost to competitiveness from the weak exchange rate has undoubtedly been a key driver of the recent turnaround, while the domestic market has remained a strong contributor to new business wins."
Mr Dobson added: “A plus point from the December survey was that the expansion was led by the investment and intermediate goods sectors, suggesting capital spending and corporate demand took the reins from the consumer in driving industrial growth forward.”