Eurozone manufacturing remains narrow in June

ISTANBUL

The eurozone manufacturing sector's Purchasing Managers’ Index (PMI) remained in contraction, down from 47.7 to 47.6, a London-based global data company said on Monday.

"Manufacturing operating conditions in the euro area deteriorated for a fifth successive month during June," IHS Markit's report said.

While consumer goods firms' operating conditions improved in the month, the report noted, intermediate and investment goods producers saw marked contractions.

"For intermediate goods, the deterioration was the sharpest recorded since April 2013," it added.

The report highlighted that operating conditions were weak over eurozone countries.

In the single-currency area, while Germany was the worst-performing nation, Austria, Spain, Ireland, and Italy recorded PMI readings below the 50.0.

"France bucked the overall trend somewhat, registering its highest PMI for nine months, though growth here was only modest," it said, adding: "Greece remained the strongest-performing, despite posting its lowest PMI reading for 19 months."

Challenging economic environment, global trade tensions, political uncertainties, underperformance in the automotive industry caused deterioration in manufacturing order books, IHS Markit said.

In June, export orders, purchasing activity, new works, and production volumes also dropped, the report underlined.

It also showed that job cuts were seen for a second month in succession.

Meanwhile, business confidence improved slightly in June, the report noted.

Chris Williamson, chief business economist at IHS Markit, said: "Deteriorating inflows of new work meanwhile meant manufacturers increasingly focused on keeping costs down, notably by cutting staff numbers and warehouse stocks."

"The downturn is also increasingly feeding through to lower inflationary pressures, as producers and their suppliers compete on price to retain customers and generate sales," he added.