Europe's factories keep expanding, though rising costs and a weak France cloud the picture
Euro zone industry held up well in October thanks to exports, while input prices rose at the fastest pace in five months.
S&P Global's purchasing managers' index for euro zone manufacturing came in at 52.7 in October, compared with 52.9 in September, Reuters reports. A reading above 50 indicates growth, and the September figure was the highest since May 2022. Output grew at the slowest pace in four months, but export orders rose at the sharpest rate in more than four and a half years. Six of the eight countries tracked saw growth, with France and Italy the exceptions.
Costs are climbing, however. Companies saw their input prices rise at the fastest pace in five months and passed this on strongly, while delivery times lengthened and they began stockpiling raw materials for the first time since late 2022. Reuters notes that the European Central Bank left interest rates unchanged last week, but that economists in a poll by the news agency expect a rate rise in December.
Country figures vary, Business AM's overviews show. In France the index fell to 49.5 from 50.6 in September, as new orders dropped and companies cut staff and purchases. Germany's index rose to 54.2, according to Reuters, supported by foreign demand. Outside the euro zone, British manufacturing posted its strongest growth in five months at 52.8. German consumers, however, are holding back: retail sales fell unexpectedly by 2 percent in September, Business AM writes.