Netherlands: Manufacturing sector conditions improve at the softest pace in over a year in March
The NEVI manufacturing Purchasing Managers’ Index (PMI), produced by S&P Global, dropped to 58.4 in March from 60.6 in February. Despite easing, the headline print remained markedly above the neutral 50-threshold that separates improving from deteriorating business conditions compared to the prior month.
The downtick was driven by the softest increase in new business since October 2020; both domestic and foreign demand cooled, in part due to a loss of sales to Russia and the uncertainty caused by the war in Ukraine. An increase in advanced orders limited the overall moderation in demand, although supply chain problems and associated price hikes continued to worry customers. Softening new orders, supply shortages and Covid-19-related staff absenteeism also weighed on output growth, which eased to its second-weakest level since November 2020. Slower demand, contingency planning, staff shortages and cancelled deliveries to Russia drove an increase in stocks of finished goods. Meanwhile, suppliers’ delivery times lengthened due to disruptions in Asia amid a new wave of Covid-19 lockdowns and the impact of the war in Ukraine. Turning to prices, input price inflation jumped in March, which drove the fastest rise in output prices on record.