Latest data released by Markit - 1 December 2020
The preliminary report can be found here. Manufacturing conditions largely held up thanks to Germany, although growth conditions have eased to lowest levels since July after achieving a two-and-a-half year peak in October. Markit notes that:
"Eurozone manufacturing output continued to grow at a decent pace in November. Although the rate of expansion cooled from October's 32-month high amid new lockdown measures, the sustained expansion should help to soften the economic blow of COVID-19 restrictions, which have hit the service sector hard. The survey therefore adds to evidence that the region will avoid in the final quarter of the year a similar scale of downturn recorded in the second quarter.
"Germany was once again the main engine behind the region's expansion, enjoying a rate of output and order book growth that has been rarely exceeded over the survey's 25-year history. Excluding Germany, output growth came close to stalling, and new order inflows fell for the first time since June. The resulting divergence between Germany and the rest of the region in terms of production growth is now the widest on record.
"Encouragingly, a brighter outlook is indicated by the upturn in optimism for the year ahead, suggesting that the upturn should gather strength again in the coming months as lockdown measures ease and spending, especially investment, picks up in response to the recent news on vaccine development. The reliance on Germany may soon also diminish, as business expectations improved or remained buoyant in all countries with the notable exception of France, which looks set to continue to lag the region's recovery.
"Shortages of inputs are meanwhile contributing to higher price pressures, with suppliers' increasingly able to raise prices amid a sellers' market for many key inputs. Such a restoration of pricing power bodes well for profits and helps ease broader deflationary concerns."
