Europe/PMI-In Germany, less supply tension in the manufacturing sector

BERLIN, Jan 2 (Reuters) – Improved tensions in supply chains helped limit Germany’s decline in manufacturing activity in December, although weak demand still weighed on it, final results from S&P Global’s monthly survey of purchasing managers showed on Monday.

The sector PMI index came out last month at 47.1 after 46.2 in November. A first estimate for December had given it 47.4, below the threshold of 50 that separates contraction and expansion of activity.

“The survey points to better availability of materials and therefore a dampening of the decline in production,” points out Phil Smith of S&P Global Market Intelligence.

“However, the rapid decline in new orders remains a problem for many manufacturers, especially manufacturers of intermediate products (ie manufacturers of components for other companies),” he adds.

In December, the new orders index is still in negative territory, for the ninth consecutive month, due to high inventories and inflation. (Written by Miranda Murray, Blandine Hnault for the French version, spoken by Kate Entringer)

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