Austria: Manufacturing PMI drops in August amid supply-side constraints
Operating conditions in Austria’s manufacturing sector continued to improve at a marked, albeit softer, pace in August, with the UniCredit Bank Austria Manufacturing Purchasing Managers’ Index (PMI) easing to 61.8 from 63.9 in July. The index consequently remained firmly above the neutral 50-threshold that separates expansion from contraction in the manufacturing sector.
The moderation came on the back of a seven-month soft rise in production amid supply-side constraints; output continued to grow thanks to rekindled demand, but supply-side issues weighed on output growth. Moreover, new export orders, expanded at the softest pace since February. Nonetheless, supply bottlenecks and robust demand saw aa further build-up of backlogs of work, forcing firms to use their stocks of finished goods to meet requirements. Turning to prices, input costs rose sharply due to raw material shortages; likewise, output price inflation remained elevated. Lastly, sentiment levels remained elevated despite worries over supply and greater price pressures.