Spain: Composite PMI improves in April while Services PMI dropped
May 5, 2016
The Markit Spain Manufacturing PMI signaled another solid improvement in the health of the manufacturing sector and the index increased from March’s 53.4 to 53.5 in April. As a result, it lies further above the 50-threshold that separates expansion from contraction in the manufacturing sector.
According to Markit, the result came on the back of an acceleration in manufacturing output growth. On the other hand, new orders and employment grew at a slower rate compared to the previous month. Moreover, input prices dropped at a faster rate in April. Markit analysts commented, “while there remains little obvious sign that the lack of permanent government in Spain is affecting the sector, a number of respondents mentioned that investment decisions and the securing of new contracts were more difficult given the current uncertainty. This would likely be exacerbated should we have to wait until new elections at the end of June for a government to be formed.”
Meanwhile, the Markit Spain Manufacturing PMI dropped from 55.3 in March to 55.1 in April. Despite the fall, the index is still above the 50-threshold that separates expansion from contraction in the manufacturing sector. According to Markit, the result came on the back of weaker growth in employment. However, activity in the sector increased sharply in April.
Author: Dirina Mançellari, Senior Economist