The manufacturing PMI index decreased for the second consecutive month in March to 53.9 in March from 54.8 in February.
The Spanish manufacturing sector remained in the growth zone at the end of the first quarter of the year and business confidence remained high and well above the series average, which has already reached almost five years. Although there were also signs of a slowdown in the sector, as it is extracted from the PMI Index of the Spanish Manufacturing Sector made public today by Markit IHS.
Manufacturing production increased significantly in March, extending the current expansion sequence to 40 months. However, the pace of growth slowed for the third consecutive month and was the slowest since October 2016. According to Andrew Harker, senior economist at IHS Markit, the report data suggests some loss of momentum during the first quarter of the year.
The report notes that both production and employment rose in March, albeit weaker, and inflation has grown at its highest rate since April 2011 (71 months), just behind the January rise.
Markit stated that although there is still a strong monthly improvement in the health sector, the latest strengthening of business conditions was the weakest since October last year.
New orders also rose at a weaker pace, but higher customer demand continued to support overall expansion. New orders for exports increased sharply, but at the slowest pace of five months.
Pending orders continued to increase in line with the increase in new orders, but the pace of accumulation in March was moderate. Companies struggled to increase their capacity by hiring additional staff, but the rate of job creation slowed.
The rate of inflation of costs accelerated in March to the fastest in almost six years, having accelerated for the seventh consecutive month, and rose especially cotton, paper, plastics, steel, fuel and other by-products of the oil. There were indications of a shortage of raw material supply in March, the report notes in this regard.