A very ugly result, comes in at 47.8
- slumping further from November's awful 49.4
- and below the flash estimate of 48.2
The flash reading for this can be found here:
In summary:
Deterioration in Conditions:
- Manufacturing conditions declined at a faster pace in December, marking the 11th consecutive monthly contraction (PMI at 47.8).
- Faster reductions in overall and export orders contributed to deeper manufacturing output contraction.
Economic Drivers:
- Elevated interest rates and reduced demand from major export markets (US, Europe, Asia, New Zealand) led to declining new orders.
- Capacity pressures eased, leading to job shedding and a reduction in outstanding business.
Inventory and Purchasing:
- Firms reduced purchasing activity and inventory holdings, reflecting reluctance to hold stock amidst falling demand.
- Stocks of finished goods fell for the 11th time in 2024.
Cost and Price Dynamics:
- Input costs rose due to higher material, energy, and shipping costs, coupled with supply constraints causing longer vendor lead times.
- Selling prices increased as firms passed on cost burdens, with output price inflation at its highest since October but below the long-run average.
Business Confidence:
- Despite the downturn, business confidence reached its highest level since August 2022, fueled by optimism for lower interest rates and local elections in 2025.
Outlook:
- Firms remain hopeful for improved production prospects in the coming year despite intensified cost pressures and ongoing challenges.
I guess business confidence climbing to a 28-month high is a positive in the report. Not much else is.
