BUSINESS

Greek factory activity returns to growth in June after 9-month contraction

TAGS: Industry, Economy

Greek manufacturing activity expanded in June for the first time in nine months, with increased production and new orders leading firms to add jobs at the fastest pace since July 2016, a survey showed on Monday.

Markit's Purchasing Managers' Index (PMI) for manufacturing, which accounts for about 10 percent of the economy, rose to 50.5 from 49.6 in May. Readings above 50 denote expansion in activity.

Behind the improvement was a rise in new orders for only the second time in almost three years, although the rate of expansion was fractional. Business from abroad continued to fall in June.

"Having endured a miserable start to 2017, the latest survey data is welcome news for Greek manufacturers as the PMI pointed to growth for the first time since August last year," said IHS Markit economist Alex Gill.

Bolstered by higher client demand, companies raised staffing numbers for the second successive month, with the rate of job creation the most marked for almost a year.

"The positive data comes in the wake of a deal between the EU and Greece to release the next tranche of loans designed to ensure it can meet payments on its debt in July," Gill said.

"While this may allay some short-term uncertainties, the path to long-term sustainable growth remains a long one."

Greek manufacturers faced further increases in input costs in June for the 15th month with the rate of inflation remaining marked and forcing firms to raise selling prices.

Firms maintained an optimistic outlook on production growth over the next 12 months, the survey showed.

[Reuters]

 

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