ROME (Reuters) – Italy’s manufacturing sector shrank in April, ending three months of growth, as production and new orders fell and purchasing activity was sharply reduced, a survey showed on Tuesday.
The HCOB Global Purchasing Managers’ Index (PMI) for Italian manufacturing came in at 46.8, down from 51.1 in March, well below the 50 mark that separates growth from contraction and the weakest reading since last October.
The number was below the median forecast of 49.0 in a Reuters survey of 10 analysts. The index was previously named after S&P, but now has a new sponsor, the Hamburg Commercial Bank AG.
The manufacturing output sub-index dropped to 48.7 from March’s 53.9 while the new orders indicator fell to 45.3 from a previous 50.8 and stocks of purchases hit 47.1 from 50.0 — its lowest level since September 2021.
“The disappointing PMI reading reflected in the main a noticeable reversal in new orders. Panellists commented that market activity was lower, characterised by client hesitancy both at home and abroad,” HCOB said.
The latest published official Italian export figures from February show growth of 10.8% year-on-year. “The HCOB PMI figures indicate that this positive trend is unlikely to continue,” said HCOB economist Tariq Kamal Chaudhry.
The weak manufacturing data came just days after the euro zone’s third-largest economy posted a stronger-than-expected 0.5% increase in its gross domestic product (GDP) in the first quarter from the previous three months.
Rome last month raised its forecast for 2023 full-year GDP growth to 1% from 0.6% but cut its forecast for next year to 1.5% from a previous 1.9%.
(Reporting by Crispian Balmer; Editing by Hugh Lawson)
