Spain April manufacturing PMI 48.1 vs 50.0 expected

• Prior was 49.5

Key findings:

• Steepest cut in new orders since December 2023
• Output down modestly for first time since last August
• Confidence in outlook deteriorates

Comment:

Commenting on the PMI data, Jonas Feldhusen, Junior Economist at Hamburg Commercial Bank, said:

“Operating conditions in Spain’s Manufacturing Sector are deteriorating. The HCOB Manufacturing PMI stays in the
contraction zone for the third consecutive month and has even deteriorated compared to the previous month. This result is
underpinned by a decline in output, for the first time since August 2024, and a significant deterioration in order volumes.
Panellists report increased uncertainty and market instability, prompting customers to delay or cancel purchasing and
investment decisions. The instability of international markets is attributed to US tariff policies and the uncertainty that
accompanies it.

“The decline in sentiment has not yet impacted employment levels. For four months, the employment index has signalled
little change. Given the poorer order situation and a reduction in backlogs, there is room for a deterioration in employment
levels in the coming months. Against this backdrop, business expectations of Spanish manufacturers also weakened in April.

“Price dynamics in Spain’s manufacturing sector have nearly come to a halt at the start of the second quarter. Input price
inflation has further weakened, as some vendors were forced to lower their prices due to weak demand. Pricing power for
customer prices was also limited, attributed to high competitive pressures and discounts to attract clients.

“For the first time this year, all sub-sectors – consumer, intermediate, and investment goods – are in the contraction zone.
The decline in intermediate goods was the most pronounced. Production there was cut, orders collapsed, and consequently,
business expectations plummeted. The consumer goods sector also declined but performed relatively better. Despite
weaker operating conditions overall, employment growth in this sector continues.”

This article was written by Giuseppe Dellamotta at www.forexlive.com.