Austria: PMI continues to move deeper into contraction in July
At the start of the third quarter, conditions in the Austrian manufacturing sector worsened as the Bank Austria Purchasing Managers’ Index (PMI) fell to a nearly six-year low of 47.0, down from June’s 47.5, boding poorly for economic momentum in the third quarter.
The downturn in July was chiefly driven by falling output amid decreasing new orders; new business dropped for the seventh month running owing to weak foreign and domestic demand. Reductions in outstanding work partly drove weaker output in the month. Subsequently, employment fell at the sharpest rate since March 2015. As input demand eased in the month, manufacturers scaled back their purchasing activity and this, in turn, led to shorter supplier delivery times. Moreover, both input and output prices fell, with the latter doing so for the first time in over three years. Lastly, sentiment among manufacturers regarding future output turned negative and dropped to its lowest level in over four years.