Eurozone Manufacturing Sector Expands At Record Pace

The euro area manufacturing sector grew at the strongest pace in nearly 24 years of data collection, underpinned by strong production and orders, final data from IHS Markit showed on Thursday.

The final factory Purchasing Managers’ Index rose to 62.5 in March from 57.9 in February. The flash reading was 62.4.

The score has been above the neutral 50.0 no-change mark for the ninth consecutive month, suggesting growth in the sector.

There were record rises in both output and new orders in March. New export orders also increased for the ninth consecutive month and at a series record pace.

The further strengthening of trade, orders and production placed further strain on already stretched supply chains.

Consequently, input costs grew at the fastest rate in a decade. Average prices charged by manufacturers also increased sharply in March. The output price inflation reached its highest level since April 2011.

Growth was broad-based across the region, with Germany and the Netherlands leading the way. Italy and France both registered levels amongst the highest in their respective survey histories. And Spain posted its best performance since late 2006.

Germany IHS Markit/BME factory PMI climbed to an all-time high of 66.6, as initially estimated, from 60.7 in February.

France final manufacturing PMI advanced to 59.3 from 56.1 in the previous month. The flash reading was 58.8. The latest reading signaled the fastest growth since September 2000.

Italy’s factory PMI improved to 59.8, in line with expectations, from 56.9 in the previous month, suggesting the steepest improvement in manufacturing conditions for 21 years.

Spain’s manufacturing PMI advanced more-than-expected to 56.9 in March from 52.9 in the previous month. The expected reading was 56.0.

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