The pace of growth of the manufacturing sector in the the euro area showed a slight acceleration in October, although the drop in new orders leaves little hope for November. The companies also cut prices for the second time since last April, following a first cut in September.
LPMI index Markit-edited manufacturing final rose to 50,6 in October from 50,3 in September, but down from the flash estimate of 50,7. The index therefore remains above the threshold of 50 which separates contraction from growth for the sixteenth consecutive month.
The sub-index relating to new orders, which measures demand, stood at 49,5, up from 49,3 in September. The result confirms the double speed of economic growth in the Eurozone.
In Italy manufacturing activity contracted in October to a 17-month low, fading the hopes matured in September that the recovery in the sector could give impetus to the country's economy.
The PMI index slipped in October to 49,0 from 50,7 in September, returning again below the threshold of 50 which separates growth from contraction. The reading turned out to be below all the estimates provided by 13 analysts consulted for the Reuters poll, which revealed a consensus of 50,7.
The figure adds gloom to the already not very comforting outlook for the Italian economy, which has contracted by about 9% since the global crisis broke out in 2007. The forecasts by the Renzi government for this year are for a drop of 0,3%. Spain instead The Spanish manufacturing sector expanded in October for the eleventh month in a row, even as the pace of growth in employment has slowed , demonstrating the slight slowdown in the country's economic recovery. The PMI index remained at 52,6, while employment growth fell to a five-month low. Growth also in Germany, the Netherlands and Ireland counterbalances the negative data from the other countries.
