The final data provided by HCOB showed that activity in the eurozone manufacturing sector declined slightly in February after reaching a 10-month high in January. Meanwhile, forward-looking indicators such as new orders and purchasing activity signaling their softest falls in close to a year.
Manufacturing PMI fell to 46.5 points from 46.6 points in January. The index remains below 50 points, which indicates a reduction in activity in the sector, since July 2022. Economists had expected the index to fall to 46.1.
HCOB said that the drop in the eurozone manufacturing PMI was entirely driven by Germany, which registered its sharpest deterioration in four months. Overall, the decline in demand for eurozone goods slowed down again (for the fourth month in a row), with production orders declining at the slowest pace since March 2023. There were also positive signals from other forward-looking survey indicators, such as the number of purchases, which declined at the weakest pace in almost a year. The improvement in these indicators coincided with the stability of growth expectations, which were at the level of the nine-month high recorded in January. Total industrial output in the eurozone declined again, but at its weakest in ten months. Nevertheless, eurozone manufacturers were able to clear orders pending completion. The rate of depletion was sharp and slightly faster than at the beginning of the year. The data also pointed to another decline in employment in February (the ninth month in a row). As for the inflationary situation, manufacturing input costs fell further, leading to further discounts on eurozone goods.