European Manufacturing Activity Approaches Turning Point! July PMI Reaches 3-Year High of 49.8
Zhitong Caijing APP has learned that according to the S&P Global Manufacturing PMI compiled by the HCOB, the European manufacturing activity PMI rose from 49.5 in June to 49.8 in July, reaching its highest level since July 2022. This data matches the initial value and is only one step away from the turning point of 50.
Despite a decline in new orders and a slowdown in production output growth, European manufacturing activity in July contracted at its slowest pace in three years as it gradually approaches stability.
Manufacturing production has continued to grow for the fifth consecutive month, but at a slower pace, with the production index falling from 50.8 to 50.6, a four-month low.
Hansa Commercial Bank's chief economist, Cyrillus de la Rubia, said: "European manufacturing is cautiously recovering its momentum. With the EU and US reaching a new trade framework, uncertainty should decrease, and various signs indicate that the upward trend will continue in the coming months."
The United States and the EU reached a framework trade agreement on Sunday, which will impose a 15% import tariff on most EU goods.
Germany, the largest economy in Europe, saw its manufacturing PMI rise to a 35-month high of 49.1, but still remained in contraction territory. France and Austria reported the worst results, both at 48.2. Among European countries, Ireland led with a PMI of 53.2, although this was two months lower. The Netherlands and Spain recorded PMIs of 51.9, setting new highs for 14 months and seven months, respectively. Greece remained in growth territory with a PMI of 51.7.
New orders decreased slightly, while export sales rebounded briefly in June before again dragging down growth. The price pressure subsided in July, and input costs held steady after three consecutive months of decline, with output prices showing little change.
The European Central Bank left interest rates unchanged last week and made a slightly optimistic assessment of the EU economy.
July's business confidence in future production output fell from June's 40-month high but remained above its long-term average level, indicating that manufacturers remain cautiously optimistic about next year.