- Services PMI 52.4 vs. 50.5 expected and 50.5 prior.
- Composite PMI 51.0 vs. 49.7 prior.
Key findings:
- New business rises modestly following two successive months of decline.
- Activity growth accelerates to four-month high.
- Employment levels broadly unchanged in October.
Comment:
Commenting on the final PMI data, Jonas Feldhusen, Junior Economist at Hamburg Commercial Bank, said:
“Italy’s economy continues to exhibit signs of stagnation. In the third quarter, GDP growth remained flat at 0.0% quarter-
over-quarter, lagging behind the growth rates seen in Spain, France, and perhaps unexpectedly, Germany. However, the
HCOB Composite PMI offers cautious optimism as we enter the fourth quarter, as it has edged back above the growth
threshold, largely driven by demand within the services sector.
This development underscores a distinct bifurcation within
the Italian economy: while the service sector is gaining momentum, manufacturing remains under pressure.
The recent growth in Italy’s service sector is primarily fuelled by a rise in domestic demand. Unlike the previous two months,
total new orders increased, injecting some fresh momentum into the sector.
Conversely, new export business continued to
trend downward, which companies attribute to the persistent challenges in the current geopolitical and economic climate.
Outstanding business has been declining for just over a year, prompting firms to exercise caution in hiring. This restraint is
further compounded by rising personnel costs, which weigh on profit margins.
On the pricing front, little has changed from the previous month. Input costs continued to rise, largely due to wage increases
as anecdotal evidence shows, and companies have managed to pass some of these costs on to end consumers. However,
it remains uncertain whether this trend is sufficient to sustain structurally elevated inflation rates.”
Italy Composite PMI