Spain’s industrial activity remains strong despite the persistence of supply problems -PMI
MADRID (Reuters) – Activity at Spanish factories rose again at a rapid pace in September, but supply chain disruptions and raw material shortages weighed on the sector, an investigation found on Friday.
The IHS Markit purchasing managers index (PMI) for the manufacturing sector in Spain fell to 58.1 in September, from 59.5 in August. However, the reading was well above the 50.0 mark which indicates an expansion in activity and was not far from the June reading of 60.4 which was the highest in more than two decades. .
âGrowth is clearly constrained by severe and persistent delays on the supply side, which show little sign of dissipating,â said IHS Markit economist Paul Smith.
Supply chain disruptions and mismatches between supply and demand for raw materials have contributed to the rise in input prices, which in turn has encouraged manufacturers to stockpile and therefore produce even more. .
Companies have reported that demand is growing further as some customers place orders in advance to protect against delivery delays.
Spain’s statistics department INE lowered second-quarter economic growth to 1.1% earlier this week, from 2.8% initially, raising concerns about the speed of the recovery.
Spain’s economy contracted 0.4% in the first quarter after rising COVID-19 cases forced further restrictions on business activity.
The government expects the economy to grow 6.5% this year after the record 10.8% contraction in 2020.
(Reporting by Inti Landauro; Editing by Susan Fenton)