The eurozone manufacturing sector slid further into contraction in September, when strength in Spain and Greece was unable to outweigh underperformance from other, larger, economies including France and Germany.
The Hamburg Commercial Bank (HCOB) eurozone manufacturing purchasing managers' index (PMI) reading, compiled by S&P Global, was 45.0 in the month, a nine-month low. It was the first fall after three months of stability at 45.8. A PMI reading of below 50 indicates a deterioration.
HCOB chief economist Cyrus de la Rubia noted a combination of falling demand and supply-chain constraints that were last seen during the Covid-19 pandemic.
"Since June, the index tracking delivery issues has been dropping alongside new orders and for the first time since February, businesses are saying they are having to wait even longer for goods than they did in the previous month," he said. "The ongoing geopolitical tensions are obviously taking their toll here." Attacks on shipping in the Red Sea have lengthened delivery times to Europe from east of Suez, with many vessels taking the longer route around the Cape of Good Hope.
Readings fell for production, new orders, employment and procurement, and producers depleted inventories. One bright spot for producers was the first fall in input costs since May, although selling prices also dropped.
In the UK the S&P Global manufacturing PMI reading was 51.5 in September, a fifth successive month of expansion, albeit at a slower rate than the 52.5 in August. Output, new orders and suppliers' delivery times were "consistent with improved manufacturing operating conditions", while levels of employment and stocks of purchases declined. Input cost inflation was at a 20-month high, and the survey noted some caution ahead of the new government setting out its fiscal priorities on 30 October.
