Netherlands: PMI falls at strongest pace in September since the pandemic’s outbreak
The NEVI manufacturing Purchasing Managers’ Index (PMI), produced by IHS Markit, dropped to 62.0 in September from 65.8 in August. While the index remained markedly above the neutral 50-threshold that separates an overall improvement from deterioration in business operating conditions, the drop in September was the steepest since April last year.
The softer expansion in operating conditions reflected easing growth in output, new orders, job creation, and stocks of purchases. New order growth was the weakest in seven months despite firm demand, and advance orders by customers on fears of further supply delays. Supply-chain issues also hampered output, which expanded at the weakest rate in the year to date. Meanwhile, although input price inflation eased to a five-month low, output price inflation picked up pace and was the third-highest on record. Lastly, the continued market recovery supported a strongly positive outlook for production in the next 12 months.
Albert Jan Swart, manufacturing sector economist at ABN AMRO, commented:
“It is rather surprising that Dutch firms continue to grow at such a fast pace in spite of all the supply chain issues. Supply chains are still severely disrupted by lockdowns in Asia and delays in container shipping. Car manufacturing, in particular, is hit hard by the microchip shortage, slowing down production in Germany. In the Netherlands, however, car production is relatively small compared to the manufacturing sector as a whole. This might be one reason why the Dutch manufacturing sector seems to be growing at a markedly faster rate than industrial output in many other countries. Another reason might be that Dutch firms such as ASML and their suppliers benefit from the solid growth of the semiconductor industry.“