Euro Area: Manufacturing PMI posts the largest drop since September 2021

Business activity in Euro Area's manufacturing sector decelerated in June at a more pronounced rate compared to the previous four months. The S&P Global Manufacturing Purchasing Managers' Index (PMI) dropped to 52 from 54.6 in May. This is the lowest level since August 2020. Further, the monthly drop is the largest since September 2021.

The S&P Global Manufacturing Purchasing Managers' Index dropped to 52 from 54.6 in May

The PMI has a threshold level of 50 which divides contraction from expansion, which means the manufacturing sector in the common currency union is still expanding but at a slower rate.

The breakdown of the data reveals that both input and output prices continued their downward trend in June, the second consecutive month. The new orders index declined markedly to 44.7 from 48.2 in May. The suppliers' delivery times sub-indicator, which was closely monitored due to the global supply chains disruptions, improved to 33.5 in June from 29.9 in the previous month.