May 02, 2024 07:54 GMT
Unexpected Underperformance In April Manufacturing PMI
ITALY DATA
The Italian April manufacturing PMI printed below expectations at 47.3 (vs 50.4 cons, 50.4 prior), in sharp contrast to Spain’s expansionary print earlier. This was a surprise to the downside, after the Eurozone flash PMI suggested manufacturing output ex-France and Germany was expected to be broadly stable. Bunds rose around 20 ticks on release.
The press release notes that new orders and output declined in April, while firms exhibited cost cutting with lower input buying and attempts to run down stocks.
Key notes from the release:
- “New orders fell at a solid pace in April, having registered a fractional improvement in March. This was the sharpest decline recorded this year so far and reflected weak demand conditions across the sector”.
- “New export orders were down markedly, amid reports of falling demand from European markets, in particular”.
- “Though operating conditions deteriorated, firms were nevertheless increasingly optimistic towards future output levels in April”
- “Italian manufacturers were also optimistic towards their hiring plans in April as jobs growth was sustained, though at an eased rate”.
- “Goods producers were able to work through unfinished orders in April, amid reports of subdued demand conditions”.
- “Firms continued to adopt a cautious attitude toward purchasing activity, thereby marking nearly two years of successive falls in buying levels”.
- “April saw input prices rise for the first time since January 2023, owing to inflated raw material costs. However, firms kept selling prices broadly the same in April, with some firms discounting charges to encourage sales”.
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