Italy: Manufacturing PMI records worst reading since November 2020 in May
The S&P Global Manufacturing Purchasing Managers’ Index (PMI) fell to 51.9 in May from April’s 54.5. May’s result marked the weakest reading since November 2020. Consequently, the index moved closer to the 50.0 no-change threshold, pointing to a moderating improvement in business conditions from the previous month.
The manufacturing PMI declined due to contractions in output and new orders. Output fell for the first time since May 2020—at which point the economy was in the teeth of the Covid-19 pandemic—while new orders dropped for the first time since November 2020. Output was weighed on by input shortages and the fall in new orders, while new orders were depressed by elevated economic uncertainty and rising prices. This points towards a deteriorating economic panorama for Italy. More positively, input inflation eased slightly from record highs, with business confidence ticking up on hopes of robust demand and reduced supply bottlenecks going forward.