Technical Analysis

Spain November manufacturing PMI 45.7 vs 45.6 expected

Manufacturing conditions in Spain continues to contract in November, albeit at a slower pace than in October at least. Further sharp drops in output and new orders were noted, with the outlook staying rather subdued. The only positive is that input prices rose at the slowest rate for two years, although prices related to energy, transportation and raw materials were all reported to have remained at elevated levels. S&P Global notes that:

“Against the backdrop of elevated inflation, rising interest rates and geopolitical uncertainties, the Spanish manufacturing economy continued to suffer in the face of sharply falling levels of output and new orders during November. Firms subsequently continued to baton down the hatches in the teeth of the economic storm, cutting purchasing, jobs, and inventories wherever possible.

“That said, there was some positive news, as price falls higher up the supply chain started to feed through to manufacturers’ input costs. Although prices still rose sharply, cost inflation softened noticeably to the lowest in two years, providing hope that any recession in the sector will be shallower and shorter than perhaps feared earlier in the year.”

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