The April survey is broadly consistent with industrial production growing at a quarterly rate of 1%, rising close to 2% in Germany. Particularly welcome is the news that previously-struggling countries such as Spain and Italy are now also seeing robust growth, with the surveys indicating growth close to 1.0% in both cases.
The final seasonally adjusted Markit Eurozone Manufacturing PMI® rose to a three-month high of 53.4, up from March’s 53.0 and the flash estimate of 53.3. The PMI has signalled expansion for ten successive months. April saw a broadening of the recovery, with PMI readings for all of the nations for which data are collected above the 50.0 mark that divides expansion from contraction for the first time since November 2007.
Levels of output and new business also increased across all of the nations. Price pressures remained on the downside. Input costs fell at the fastest pace since July 2013, reflecting reports of successful price negotiations, competition among suppliers and lower prices for metals and food products. Output charges,
meanwhile, declined slightly for the second straight month.
Rates of improvement also accelerated in Germany, Italy and Austria, but eased in France, Spain and the Netherlands. Greece returned to growth.
Eurozone manufacturing production rose for the tenth successive month in April, with the rate of expansion the highest since January.
Underlying the accelerated increase in output was a further gain in new business, as domestic market conditions continued to stabilise and export orders posted a further increase. Although the rate of expansion in total new orders eased slightly, it remained above the average for the current ten-month sequence of growth.
Higher levels of new export business were reported in almost all of the nations covered, the exceptions being Greece (a decline) and Austria (no change). Where an increase was reported, this was linked to improving economic conditions in key markets such as the US and Asia.
The pace of new order growth tested capacity at a number of eurozone manufacturers, leading to an accumulation of backlogs of work for the seventh successive month in April. With both new business and outstanding work rising further, companies increased employment for the fourth straight month and at the fastest pace since August 2011.
Rates of job creation accelerated in Germany, Italy and Spain, and stabilised in Ireland and Austria. The Netherlands and Greece also reported slight increases to payroll numbers following declines in the prior survey month. A slight cut to headcounts was implemented in France, however, reversing the slight gain registered in March (which was the first rise in two years).
