Eurozone manufacturing growth slows to six-month low in August

The euro area manufacturing sector registered another marked expansion during August, latest Purchasing Managers Index (PMI) data showed, although momentum waned once again as the headline index fell to a six-month low. The final reading of the IHS Markit Eurozone Manufacturing PMI for August of 61.4 was down from 62.8 in July. This marked a second successive month in which growth has slowed in the sector since June’s survey record expansion.

The overriding issue was again a lack of components, however, with suppliers either unable to produce enough parts or are facing a lack of shipping capacity to meet logistics demand.


Key facts:
  • Goods production across the eurozone continued to expand.
  • Total new orders increased for a fourteenth straight month in August, while new export business also grew at a marked rate.
  • The Netherlands, Germany and Italy performed particularly well on the export front.
  • However, the overall rate of growth in export demand across the eurozone lost momentum in August.
  • Supply issues were the primary cause of a shortfall of manufacturing production relative to orders.
  • Factory selling prices consequently rose steeply once again, though with some of the upward pressure alleviated by a slight cooling of input cost inflation, albeit with still-high materials prices adding to manufacturers’ problems.
  • Employment growth eased only modestly from July’s all-time high as producers remained focused on boosting operating capacity.





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