Netherlands: PMI falls to 18-month low in February
March 1, 2016
The NEVI Manufacturing Purchasing Managers’ Index (PMI), which is produced by Markit and NEVI, fell from 52.4 in January to 51.7 in January, which marked the lowest reading since August 2014. Despite the drop, the PMI remains above the 50-threshold that separates expansion from contraction in business conditions.
February’s fall mainly reflected that production recorded the slowest expansion since July 2013 and that total new orders stagnated. While new export orders continued to rise, their pace of growth slowed. Adding to this, firms lowered their purchasing activity, which caused a decrease in pre-production stock levels. As for price developments, both input and output prices recorded larger decreases than in February, largely owing to lower prices for commodities such as oil and steel.
According to the survey report, “softer demand conditions weighed on the Dutch manufacturing sector in February, with new order growth petering out. Having enjoyed a sustained spell of decent growth, the sector has begun 2016 on an uncertain footing. Low commodity prices were reflected in sharper falls in input costs and factory gate prices, pointing to persistent downward pressures on inflation.”