Eurozone Manufacturing Activity Slump On Orders, Production
Euro area manufacturing activity shrunk substantially in October
due to accelerated contractions in new orders and production, the
purchasing managers' survey results published by S&P Global
revealed on Thursday.
The HCOB manufacturing Purchasing Managers' Index, or PMI
dropped to a three-month low of 43.1 in October from 43.4 in
September. The score was slightly above the flash 43.0.
The index has remained below the neutral 50.0 mark for the
sixteenth straight month, signaling a sustained contraction in the
sector. New orders declined at one of the steepest pace in the
survey history. Similar trends were observed in the quantity of
purchases and backlogs of work. Factory production volumes fell at
the joint-second strongest rate since May 2020.
Manufacturers reduced their stocks of purchases and the rate of
depletion was the strongest since November 2012. Post production
inventories decline was the sharpest in over two years.
Factories tried to reduce cost through job cuts. The rate of job
shedding was the most marked since August 2020. The survey showed
that manufacturers remained marginally optimistic towards the
12-month outlook but the level of positive sentiment slid to an
Both output and input prices continued to decrease in October.
Factories continued to pass through cost savings via a reduction in
"It looks like the eurozone countries are pulling each other
down," Hamburg Commercial Bank Chief Economist Cyrus de la Rubia
"With France, Italy, and Spain PMIs diving and Germany already
signalling a deep manufacturing recession, it is pretty clear that
the sector is headed for a contraction in all these countries this
quarter," the economist said.
Among major economies, Germany was the worst performer, despite
its downturn easing again. At the same time, France registered its
strongest contraction in nearly three-and-a-half years. Faster
declines were also noted for Italy and Spain.
French manufacturing contracted the most since May 2020. The
HCOB manufacturing PMI dropped further below the 50.0 mark in
October to 42.8 from 44.2 in September. The flash score was 42.6.
Germany's manufacturing activity contracted further due to a
sustained downturn in new orders in October. The PMI came in at
40.8, up from 39.6 in September and the flash reading of 40.7.
In Italy, the manufacturing downturn intensified with output and
new orders declining at faster rates. The HCOB factory PMI
registered 44.9 in October. The score was the lowest in three
months and below September's level of 46.8.
Spain's manufacturing shrank the most in a year. The
corresponding index dropped to 45.1 from 47.7 in September.
Sterling vs Yen (FX:GBPJPY)
From Jan 2024 to Feb 2024
Sterling vs Yen (FX:GBPJPY)
From Feb 2023 to Feb 2024