The industrial activity of the euro zone continued expanding in October, although with somewhat less momentum than in the previous month. The manufacturing PMI index compiled by S&P Global stood at 52.7 points, below the 52.9 recorded in September, which represents its lowest level in two months.
With this data, the indicator remains for the ninth consecutive month above the 50-point threshold that marks the line between growth and contraction. In parallel, manufacturing output stood at 52.8 points, compared with 53.6 in the previous month, its lowest value in four months.
At the start of the fourth quarter, manufacturing in the euro zone continued advancing, although the increase in new industrial orders lost some strength and tensions in supply chains intensified, according to the S&P Global survey.
Despite these conditions, employment in the sector rose again and input purchasing activity rebounded to its strongest pace since May 2022.
At the same time, the accumulation of raw material inventories reached its highest level in nearly four years, coinciding with a greater worsening of supplier delivery delays and with inflation in input costs at a five-month high.
France and Italy break with the overall expansion
Among the eight countries in the euro zone with available data, six recorded in October manufacturing PMI readings consistent with growth. In all of them, the pace of expansion was described as "historically strong", surpassing their historical averages for the survey.
France and Italy were the only economies that moved away from this expansionary dynamic, by posting a new monthly deterioration. Manufacturers in both countries continue to face a complicated environment and, in the case of France, the difficulties are aggravated by internal political uncertainty, according to S&P Global.
The chief business economist of S&P Global Market Intelligence, Chris Williamson, underlined that a new solid PMI reading extends the best period of manufacturing sector growth in the euro zone in more than four years.
In addition, he highlighted that the continued growth since February reflects a scenario of resilience for European industry, despite the impact of adverse factors such as tariffs, conflicts in the Middle East, higher costs, and the resulting supply problems.
The expert added that the latest PMI results increase pressure on the European Central Bank to continue tightening monetary policy in the coming months, which poses a "new obstacle for companies".