Euro area industrial activity ramps up in July even as demand conditions are still weak – PMI data
- July final manufacturing PMI 51.9 vs 52.0 prelim
- Prior 51.4
Euro area manufacturing activity recovers to a three-month high, largely underpinned by Germany. Overall demand conditions in the region remain fragile at best but at least there is slight evidence of a rise in new orders.
The manufacturing output index was the more impressive number here, rising to 52.9 - a 52-month high. The quicker expansion was underpinned by the completion of backlogged orders alongside a slight pick-up in sales.
That being said, supply chain pressures nevertheless remained intense, although they were the least pronounced in five months. Adding to that as well is that inflation pressures also eased in July.
S&P Global notes that:
"Eurozone factories are enjoying something of a summer growth spurt, with production rising at its fastest rate for four and a half years. However, there are signs that this good news may prove short-lived, with momentum at risk of fading as autumn approaches.
"Germany, the Netherlands, Austria and Greece are reporting robust production growth, but output is falling in France and Spain, while Italy is seeing only a modest gain. These divergences underscore how large parts of the region continue to struggle amid weak demand, high prices and supply delays.
"Although supply bottlenecks and energy-linked price pressures eased slightly in the July survey period, supply chain stress and energy prices remain elevated amid ongoing tensions in the Middle East, threatening to constrain production and further dampen demand in the coming months.
"New work inflows therefore remain worryingly weak, meaning producers are having to rely on orders placed in prior months to drive the latest increase in production. As a result, factories continue to reduce headcounts amid concerns over a potential lack of work in the coming months, highlighting that the manufacturing economy is not quite as healthy as the headline numbers might suggest."
This article was written by Justin Low at investinglive.com.提供 MainLink：Investinglive RSS Breaking News Feed
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