S&P Global’s seasonally adjusted Purchasing Managers’ Index (PMI) for the Greek industrial sector closed at 54 points in June, indicating a steady recovery in the health of the Greek industrial sector by mid-year. However, the pace of improvement weakened for the third consecutive month and was the slowest recorded since the end of 2023.
New order growth remained strong relative to historical data as demand conditions remained favorable for sales in June, according to research from S&P Global. However, the pace of growth slowed to the weakest level on record so far in 2024, as some reports of weaker confidence among existing customers dampened the overall increase.
Weaker output growth
Furthermore, new export orders increased for the seventh consecutive month, albeit at a marginal pace, which was the slowest since December 2023. As such, Greek manufacturers recorded new, albeit weaker, production growth in mid-2023. year.
The pace of growth weakened again from the recent high in March, but was still noticeably higher than the survey’s long-term average, due to continued demand for Greek products.
However, the Greek industrial sector continued to be hit by supply difficulties. Supplier performance declined again in June as delivery times for supplies were extended to the longest since March. Along with ongoing shipping problems, some companies reported that congestion at ports in Asia, including Singapore, delayed deliveries of inputs.
According to survey members, supplier delays led to higher transport costs for businesses, while this, combined with increases in raw material prices, led to an increase in input prices in June. The pace of cost growth slowed slightly from May, but was the second fastest in 18 months.
The favorable sales environment allowed companies to increase selling prices at historically high rates in mid-2024. However, companies continued to seek to remain competitive as the pace of growth fell to the slowest level since Last November.
Meanwhile, business confidence declined slightly in June, as the optimism score fell to its lowest level in six months. However, Greek manufacturers were, based on historical data, optimistic about the outlook for production next year.
Furthermore, the positive climate supported further job creation. Employment rose sharply, albeit at the slowest pace in four months, as businesses tried to catch up.
As a result, the level of backlogs fell for the eleventh consecutive month and at a more pronounced pace. In line with the weaker increase in new orders, manufacturers reduced the rate of growth in input purchases in June. Firms sought to alleviate delays in deliveries from suppliers as purchasing activity increased steadily. However, both supplies and finished goods inventories fell as firms tried to meet order demands.