MADRID, 1 Sep. (EUROPA PRESS) -
The activity of the Spanish manufacturing sector deteriorated in August for the fifth consecutive month and has fallen to its lowest level so far this year, according to the PMI index, which has fallen to 46.5 points from 47.8 points of the previous month, according to the survey of S
The drop in the index in August was the result of the contraction in the volume of backlog orders. Total new orders fell for the fifth consecutive month due to weak demand and the latest reduction has been the most intense since the pandemic began.
"We are fairly certain that the manufacturing sector has entered a recession, which began in the second quarter. We estimate that the fall in the industry has become more acute," summarized Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, for whom, in the short term, "the situation will get worse before it gets better again."
"The weakness comes mainly from domestic demand. While new export orders fell at roughly the same rate as in July, the slowdown in total new orders intensified markedly," De la Rubia says.
Despite the drop in activity, business sentiment improved in August to its highest level in six months on expectations that demand will grow over the next year and employment rose for the first time in three months.
"Although the overall picture is not too positive, industrial firms remain quite optimistic. A higher proportion of survey respondents indicated that they expect increased production in the next twelve months. This result is consistent with the observation from that employers have stopped cutting staff, after two months of modest reductions," De la Rubia pointed out.