The Spanish manufacturing sector contracted again in November as new orders fell for the first time in six months, underscoring the anemic state of the incipient recovery.
Consultant Markit said Monday that its Purchasing Managers’ Index for the manufacturing sector in Spain fell to 48.6 points last month from 50.9 in October. A reading of below 50 indicates a contraction in business.
November’s reading was the first deterioration in business conditions in four months and was largely the result of the overall contraction in new orders and output. However, growth in new export orders continued, albeit at the slowest pace since July.
The drop in new orders forced manufacturers to cut output after three consecutive months of growth.
“The latest PMI survey highlights the current fragility of the Spanish manufacturing sector, with the domestic market the key sources of weakness,” Markit economist Andrew Harker said. “The only real positive from the November data is a further rise in new export business.”
Harker said there was little sign of any inflationary pressure with companies surveyed cutting output prices after a slight increase in October.