LONDON (ICIS)--Eurozone industrial sector momentum sank further into contraction territory in April, to hit a four-month low as new orders declined by the sharpest rate seen in 2024.
The eurozone manufacturing purchasing managers’ index for April slumped to 45.7 in April compared with 46.1 in March, a third month of consecutive declines, after jumping to 46.6 in January from 44.4 in December.
Driven by still-bearish conditions in Germany, Austria, France and Italy which counterbalanced firmer growth in Greece and Spain, the figure represents the 22nd straight month of recession for the sector. A PMI score of above 50.0 signifies growth.
On the plus side, factory output shrank at the slowest rate this year, delivery times shortened during the month and declines in manufacturer operating costs were the most modest seen in 2024.
Released on Thursday by S&P Global, the data is in line with recent reports from the UK and the US, showing that manufacturing activity in both economies sank back into contraction territory last month.
For the UK and US, March was the first month of tentative expansion in months, but since then demand in the US has softened and the Red Sea crisis has exacerbated declining output, new orders, employment and stocks of purchases in the UK.
What is going to rescue the eurozone economy? Although it is a difficult question, one thing is clear: It’s not the manufacturing sector,” said Hamburg Commercial Bank chief economist Cyrus de la Rubia.
“A plethora of evidence highlights the stark absence of demand, as evidenced by a rapid decline in new orders, unmatched in speed over the past four months and devoid of international support,” he added, noting that current conditions “portends a postponement of any semblance of recovery.”
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