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Eurozone manufacturing continued to grow in October, according to the latest purchasing managers’ survey data from S&P Global.
The pace of growth did however slow, with the index dipping to 52.7 last month from 52.9 in September (which was the highest reading sine May 2022). Any reading above 50 signals growth.
Another solid PMI reading extends the eurozone’s best growth spell for manufacturing for over four years. The sustained growth recorded since February paints an encouraging picture of resilience for the manufacturing sector, which has been buffeted by the headwinds of tariffs and conflicts in the Middle East and Ukraine, and in particular the surge in costs and supply difficulties that these have caused.
Instead, increased defence spending, precautionary inventory building, diversification and changing trade patterns due to US tariffs have created growth opportunities for many producers.
Furthermore, with input cost inflation surging sharply higher again in October, climbing to one of the highest rates seen over the past four years thanks to higher energy prices and supply bottlenecks, the latest PMI data add to pressure on the [European Central Bank] to hike rates further in the coming months, providing another headwind to businesses.” Continue reading…
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