- Prior 46.8
That's a miss on Italy as well as manufacturing conditions continue to be hampered by weak demand. Of note, output and new sales were seen contracting at a faster pace in October. HCOB notes that:
“It doesn’t look good for the Italian manufacturing sector. According to the HCOB PMI, output contracted for the seventh consecutive month with new orders overall and from abroad declining at some of the fastest rates in the last 12 months. According to official data from ISTAT, manufacturing has been declining continuously since the third quarter of 2022. With this new, weaker data it is almost certain that the decline in manufacturing will continue and likely accelerate.
"The recession in the manufacturing sector steepens. According to our nowcast model, which considers the PMI, manufacturing is set to decline 0.5% in the fourth quarter of 2023. Our model computes the strongest decreases in the intermediate and consumer goods segments, with the latest HCOB PMI figures also flagging weakness in these groups.
"Italian manufacturers are stuck in a rut with weak demand. Uncertainty surrounding the economic climate is clearly weighing on order book volumes, which shrank for the seventh month running. Rising geopolitical tensions and weak international demand were also two notable reasons as to why new export orders declined. Overall, sustained weakness in demand raises the possibility for a prolonged economic downturn.
"Manufacturers remain somewhat optimistic. The firms surveyed cited the hope of a market recovery as the main reason for their optimism. However, the Future Output PMI undercuts the long-term average, which could be seen as the divider between optimism and pessimism.”
