Growth in Greek manufacturing activity accelerated in August for the third consecutive month as rising demand at home and abroad led firms to add jobs and increase production, a survey showed Friday. Markit’s Purchasing Managers’ Index (PMI) for manufacturing, which accounts for about 10 percent of the economy, rose to 52.2 from 50.5 in July, its highest print since August 2008.
Readings above 50 denote expansion in activity. The pickup in growth was driven by a solid increase in new business, the sharpest since May 2014, with export orders also rising for the first time in a year. “Having endured years of economic malaise, the latest data will be music to the ears of many concerned with Greek manufacturing,” said IHS Markit economist Alex Gill.
To keep pace with rising client demand, companies increased staffing numbers for the fourth straight month in August, at the most marked pace in more than 17 years. “Underlying the expansion were robust increases in new business, contributing to the sharpest round of job creation since January 2000. This will buoy hopes for a reduction in the country’s high unemployment,” Gill said. While input price inflation remained solid, strong client demand boosted manufacturers’ pricing power, leading to higher factory gate prices on average, the survey showed.
As production grew, manufacturers increased purchasing activity at a rate that hit a nine-year high. “The strong degree of optimism can at least partially account for the rise in demand and is indicative of a more positive narrative surrounding the Greek economy, spurred on by the country’s return to bond markets in July,” Gill said. [Reuters]