Italy PMI December 2021


Italy: Manufacturing PMI deteriorates in December

January 3, 2022

The IHS Markit Manufacturing Purchasing Managers' Index (PMI) came in at 62.0 in December, down from November's 62.8. Consequently, the index remained entrenched above the 50-threshold, signaling a continued improvement in business conditions from the previous month.

Despite the slowdown, the reading was broadly positive and closed a fourth quarter that reached the highest average on record. The result was largely driven by slowing, yet still sharp, growth in output and new orders. Meanwhile, order book volumes increased at the fourth highest rate on record, reportedly due to strong client demand, with export orders following the same pattern. Meanwhile, backlogs intensified as new orders surpassed output and pressured capacity. Consequently, in a bid to fill the ranks, the rate of job creation was among the highest on record. Meanwhile, supply disruptions kept pressuring input costs, which in turn were passed on to clients.

Lewis Cooper, economist at IHS market, commented on the outlook:

"In spite of the strong performance, companies moderated their expectations towards output over the next year, with sentiment the weakest since April 2020, as some firms noted concerns surrounding COVID-19, price pressures and supply disruptions. That said, the sector remains in a very strong position as we enter 2022 with little sign of growth momentum fading significantly."

FocusEconomics Consensus Forecast panelists see fixed investment increasing 5.9% in 2022, which is down 0.2 percentage points from last month’s estimate. For 2023, the panel expects fixed investment to increase 3.6%.

Author:, Junior Economist

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Italy PMI Chart

Italy PMI December 2021

Note: IHS Markit Purchasing Managers’ Index. Readings above 50 indicate an overall increase compared to the previous month, and below 50 an overall decrease.
Source: IHS Markit.

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