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Italy PMI February 2020

Italy: Manufacturing conditions weakens in February

The IHS Markit manufacturing Purchasing Managers’ Index (PMI) dipped to 48.7 in February from 48.9 in the first month of 2020. The index thus moved further below the crucial 50-threshold, indicating worsening conditions in the manufacturing sector, where it has been for over one year.

The deterioration in the headline PMI came mainly on the back of a sharper decline in output and faster job shedding, while the contraction in new orders softened. Output has now fallen for 19 straight months against a backdrop of weak domestic and external demand. As a consequence, manufacturers reduced their staff numbers, and did it a quicker pace than in January, amid declining backlogs of work. On the price front, input costs fell further due to lower prices for raw materials, which led firms to cut their output prices as a result. More positively, however, businesses expected output to rise going ahead on improved demand prospects, although sentiment weakened somewhat from January.

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