FLIY - Euro area manufacturing PMI confirmed at 48.5 eighth straight month of falling factory activity

• The S&P Global Eurozone Manufacturing PMI was confirmed at 48.5 in February of 2023, slightly below 48.8 in January, and pointing to the eighth straight month of falling factory activity.
• Suppliers’ delivery times showed a considerable easing of supply-chain pressures, which typically indicates worsening manufacturing sector conditions, and stocks of purchases signalled the most marked decline in preproduction inventories since May 2021.
• On the other hand, output, new orders and employment had a positive effect, with manufacturing production volumes broadly stabled, ending an eight-month sequence of contracting output.
• February saw another considerable easing of input cost inflation which were the lowest since September of 2020 and output price inflation was the softest in two years.
• Looking ahead, euro area manufacturers were slightly more optimistic towards the year-ahead outlook when compared to January.
• “A marginal expansion of output reported by Eurozone manufacturers in February is welcome news in representing the first increase since last May and a further improvement in the underlying trend from the low seen back in October."
• “The brighter production picture first and foremost reflects a broad-based improvement in supply chains, with deliveries of inputs into factories quickening on average to a degree not seen since 2009. Fewer supply shortages and delays have facilitated higher output, allowing companies to deal with backlogs of work accumulated during the pandemic."
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