Manufacturing activity across the eurozone continued expanding in October, with the S&P Global Manufacturing PMI slipping slightly to 52.7 from September’s 52.9, which was the highest reading since May 2022.
- The index remained above the 50-point expansion threshold for the ninth consecutive month, marking the region’s strongest stretch of manufacturing growth in more than four years.
Why it matters: Manufacturing output slowed to a four-month low of 52.8 from 53.6, as new order growth weakened. However, export orders increased at their fastest pace in more than four years, while purchasing activity reached its highest level since May 2022.
Regional differences: Six of the eight surveyed countries reported expanding manufacturing activity, with France and Italy the only two experiencing contractions.
Inflation concerns: Supply-chain disruptions intensified, pushing input price inflation to a five-month high. Manufacturers increased selling prices in response, while inventory stockpiling accelerated amid longer delivery times.
The bottom line: Eurozone manufacturing remains resilient despite slowing production growth. However, rising energy costs and supply-chain pressures are fueling inflation concerns, potentially increasing pressure on the European Central Bank to raise interest rates further.