Eurozone manufacturing slowdown eases in November, PMI shows

The slowdown in euro zone manufacturing activity eased in November, according to a survey released on Thursday (1st) which suggests that while the bloc’s factories still face a harsh winter, it may not be as bad as was initially feared.

S&P Global’s final manufacturing Purchasing Managers’ Index (PMI) rose to 47.1 from 46.4 in October, but was below the preliminary reading of 47.3 and below the 50 mark that separates growth from contraction.

A manufacturing index, which feeds into a composite PMI due on Monday and is seen as a good guide to economic health, rose to 46.0 from 43.8, marking its sixth month of readings below 50.

“The PMI signals some welcome moderation in the intensity of the euro zone manufacturing slowdown in November, which will fuel hopes that the region is not facing as severe a winter slowdown as previously anticipated by many,” said Chris Williamson, Chief Business Economist at S&P Global.

Suggesting there won’t be a quick recovery in the sector, however, new orders have dropped sharply, remaining firmly below 50 at 40.7, albeit above the October reading of 37.9.

UK

British manufacturing activity fell for the fourth consecutive month in November as companies faced the weakest external demand in two-and-a-half years, leading to job cuts and reduced confidence about the year ahead, a survey showed on Thursday.

The figures add to signs that the UK economy has slipped into recession, although there has been a glimmer of light for the Bank of England as industrial goods price inflation has slowed to the lowest level since March 2021.

The S&P Global/CIPS Manufacturing Purchasing Managers’ Index rose to 46.5 in November from 46.2 in October, which was the lowest number in two and a half years.

November’s reading is well below the 50 mark that divides growth from contraction, although slightly stronger than an earlier preliminary reading that was unchanged from October.