Eurozone Factory PMI Signals Robust Growth In November

The euro area manufacturing sector expanded for the fifth successive month in November despite new lockdown measures, final data from IHS Markit showed Tuesday.

The final factory Purchasing Managers’ Index fell to 53.8 in November from 54.8 in October.

Nonetheless, the score was above the flash estimate of 53.6 and any reading above 50 indicates expansion.

The survey adds to evidence that the region will avoid in the final quarter of the year a similar scale of downturn recorded in the second quarter, Chris Williamson, chief business economist at IHS Markit said.

The survey revealed that production growth moderated from October’s two-and-a-half year peak. A similar trend was seen for new orders, where growth eased to the weakest in the current five-month sequence.

Increased production and order requirements meant that firms continued to increase their purchasing activity.

On the price front, input cost inflation accelerated to the sharpest in nearly two years. Efforts to protect margins led to a second successive monthly rise in output prices.

Business confidence improved to its highest for over two-and-a-half years in November.

Among member countries, Germany remained the best-performing nation in November. Solid growth was seen in Austria and Italy, in contrast to marginal contractions recorded in both Spain and France.

Germany’s manufacturing sector continued to improve in November although there was a slight loss of momentum in the pace of expansion. The IHS Markit/BME factory PMI dropped to 57.8 from two-and-a-half year high of 58.2. The flash reading was 57.9.

The French manufacturing sector contracted for the first time in three months as the country faced new restrictions. The factory PMI came in at 49.6, down from 51.3 in October and the flash score of 49.1.

Italy’s manufacturing sector recovery lost momentum in November. The factory PMI dropped to 51.5 from 53.8 in the previous month. The score was also below economists’ forecast of 52.0.

Spain’s manufacturing activity returned to contraction in November as the downturn in market demand weighed heavily on the sector. The factory PMI fell to 49.8 in November from 52.5 in the prior month.

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