Netherlands: Manufacturing operating conditions improve at the strongest clip in nearly two years in November
The NEVI Manufacturing Purchasing Managers’ Index (PMI), published by IHS Markit, rose to a 22-month high of 54.4 in November from 50.4 in October. Consequently, the index moved further above the neutral 50-threshold that separates an overall increase from decrease compared to the prior month.
The uptick was driven by the strongest rise in output in nearly two years; order book growth; and the first expansion in payroll numbers in nine months. The sector chiefly benefitted from healthier domestic and foreign demand, and export orders increased for the fourth month running. Turning to prices, inflationary pressures rose at the steepest pace since January 2019 due to costlier raw materials and supplier price hikes. These were passed on to clients, with output prices rising at the quickest pace since April 2019. Lastly, producer sentiment improved in the month due to hopes of an end to the pandemic amid positive news on the Covid-19 vaccination front, which should prelude a return to normalcy and global economic recovery.
Commenting on the result, Albert Jan Swart, manufacturing sector economist at ABN AMRO, noted:
“Investment goods, in particular, were in higher demand in November. It seems that some investment plans that had been postponed since the start of the pandemic are now revived because of the good news on vaccines, leading to higher demand for machinery.”