Austria: PMI improves in January but remains in contractionary territory
January 29, 2020
Although overall business conditions in Austria’s manufacturing sector continued to worsen in January, the pace of deterioration softened significantly. The UniCredit Bank Austria Manufacturing Purchasing Managers’ Index (PMI) jumped from 46.0 in December to 49.2 in January, marking a nine-month high.
The softer deterioration in operating conditions reflected weaker contractions in total new orders and output. While total new orders fell for the 13th month running owing to weakness at home, new export orders rose for the first time in nearly a year-and-a-half. The decline in output also eased as production of consumer and investment goods grew. Moreover, jobs were shed at a reduced pace in the month.
Looking at prices, average input price pressures softened as purchasing activity among goods-producers was scaled back in accordance with still relatively weak demand dynamics. Output prices, meanwhile, dropped on the back of fierce competition for new orders and lower input prices. In spite of current weakness in demand, sentiment rose to the highest level since September 2018 as firms expected a pick-up in export sales.
Author: Jan Lammersen, Economist