Eurozone manufacturing growth falls to 18-month low

ANKARA

Eurozone manufacturing declined to 54.6 from 55.5 in April, an 18-month low, a survey showed on Wednesday.

"Although output growth picked up marginally from April’s recent low, it remained sluggish, while business confidence was among the lowest seen over the past two years amid sustained concerns surrounding the outlook for prices, supply chains and demand," data company S&P Global said.

Prices data signaled still-substantial inflationary pressures in May despite rates of increase in both input costs and output charges easing slightly.

Commenting on the final Manufacturing PMI data, Chris Williamson, chief business economist at S&P Global Market Intelligence, said: "Euro area manufacturers continue to struggle against the headwinds of supply shortages, elevated inflationary pressures and weakening demand amid rising uncertainty about the economic outlook."

However, he added, the manufacturing sector’s “deteriorating health has also been exacerbated by demand shifting to services, as consumers boost their spending on activities such as tourism and recreation.”

"A major driver of the first drop in new orders for almost two years was the ongoing supply crunch and accompanying price pressures, with producers of many goods and raw materials raising their prices yet again alongside a recent surge in energy prices," Williamson said.