Spain manufacturing falls back into contraction in August – PMI data
- Spain August manufacturing PMI 49.5 vs 50.3 expected
- Prior 50.2
It's not a good look in August for Spain manufacturing activity, with both output and new orders declining. The worsening business activity reflected some concerns over rising prices, especially for energy, with latest data showing a noticeable acceleration in overall input cost inflation.
Meanwhile, supply-side challenges also remained evident, with typical lead times for the delivery of inputs again deteriorating to a considerable degree.
Circling back to the drop in production, that is also in part due to the usual seasonality related to summer factory shutdowns. However, the survey notes that the drop was primarily linked by panellists to a modest decline in new work amid reports of stagnant market conditions and demand. So, there's that.
S&P Global notes that:
“August proved to be a somewhat challenging month for Spain’s manufacturing sector, with output and new orders declining on the month amid stagnant market demand. Weakness was especially prevalent amongst capital goods producers as firms continue to struggle to secure investment and commitments to new contracts given the uncertainty that exists within the marketplace.
“This uncertainty can be linked to the rollercoaster in price setting that firms continue to experience in 2026. With energy costs picking up again in August, input price inflation has once again surged higher, placing noticeable pressure on margins and meaning confidence in the outlook remained subdued. No wonder firms remained reticent to hire or buy-in new inputs, with both employment and purchasing activity subsequently cut over the month.”This article was written by Justin Low at investinglive.com.
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