Austria: Business conditions in Austria deteriorate in April
Austria’ manufacturing sector began the second quarter on a sour note with the Bank Austria Purchasing Managers’ Index (PMI) dropping to 49.2 in April from a neutral reading of 50.0 in March. April’s print reflected the weakest reading since March 2015 and indicates that business conditions deteriorated.
The drop in the headline figure came on the back of a stronger decrease in new orders and weak growth in output, while supplier delivery times shortened and job creation growth eased as a result of softer demand. New orders fell for the fourth month running and at the strongest pace in over four years, reflective of both feebler demand at home and abroad. Consequently, output grew at the slowest pace in 49 months. These two factors also drove a decrease in outstanding business and an increase in stocks of finished goods. Waning demand and lower outstanding business suggest output growth could soften in the months ahead.
Regarding prices, input prices rose at the softest pace in over two-and-a-half years in April, with oil prices being the main driver of inflation. Consequently, output prices rose at a weaker pace too. In terms of sentiment, manufactures became somewhat more cautious in their outlook on production in the next 12 months.