Latest data released by Markit - 1 June 2020
- Prior 31.1
Italian factory activity contracted by less-than-expected last month as restrictions were loosened and factories reopened across the country. That said, the report highlights that demand conditions remain weak with new orders continuing to drop sharply.
Of note, firms were still seen cutting jobs in May at a pace seen similar to mid-2009.
Markit notes in their report:
"The downturn in the Italian manufacturing sector continued during May, as the impact of the COVID-19 pandemic weighed further on production and new orders. The rates of decline eased, however, as parts of the economy began to reopen and lockdown restrictions were lifted, suggesting that the downturn likely bottomed out in April.
"With demand conditions still weak and growing excess capacity, firms continued to make substantial job cuts during May. The drop in workforce numbers was the second-quickest recorded since mid-2009, rivalled only by April's recent record.
"Latest official data, updated to March, showed a substantial drop in manufacturing production, with the decline in excess of 30% on an annual basis, and PMI data point to further large falls in April and May. Although latest figures highlighted a softer rate of deterioration, conditions across the sector remain extremely challenging as firms struggle to revive demand both domestically and abroad. A recovery from such a colossal downturn will inevitably take some time."
