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Spain PMI October 2019

Spain: Composite PMI slumps to near six-year low in October

Reflecting a sharper deterioration in manufacturing activity and softer growth of the services sector, the IHS Markit composite Purchasing Managers’ Index (PMI) slipped from 51.7 in September to 51.2 in October, the lowest reading since November 2013. The index, however, remained above the 50-threshold, indicating healthy expansion in business activity.

The IHS Markit Manufacturing PMI slid from 47.7 in September to 46.8 in October, the worst result in six-and-a-half years. As a result, the index moved further below the 50-threshhold, where it has been for five successive months, and signaled contractionary conditions in the sector. The downturn mainly reflected sharper falls in both production and new orders due to lackluster demand amid a backdrop of heightened economic and political uncertainty, both domestically and abroad. In addition, manufacturers shed jobs for the sixth consecutive month in October, while confidence remained subdued as firms expected political uncertainty to persist. On the price front, both input costs and output charges fell again in the month.

Meanwhile, the IHS Markit Services PMI dipped from 53.3 in September to an over one-year low of 52.7 in October mainly on softer new business gains. Notably, new export business fell at a series-record pace in the surveyed month. Regarding prices, although operating expenses rose sharply, firms cut selling prices for the third month in a row in the face of increased competition and in a bid to keep up sales. Lastly, service providers raised their workforce numbers, though only marginally, while business confidence remained fairly positive in October.

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