Greek PMI in manufacturing at 43-month high in July, prompting hope ‘recovery is on horizon’

The Purchasing Managers’ Index (PMI) in manufacturing hit a 43-month high in July, according data published on Thursday.

Economic analysis firm Markit said the PMI rose to 47.0 in July, from 45.4 in June.

“The headline index has now risen in six of the past seven months, highlighting a sustained slowdown in the pace of contraction in Greece’s manufacturing sector,” said Markit.

“One factor helping lift the headline PMI towards the all-important 50.0 threshold was a slower decline in output. July’s decrease was the least marked since,” said the analysts. “April 2011, and substantially slower than the pace of contraction seen at the start of the year.”

A similar trend was noted in new orders and job losses, pointing towards a flattening out of Greece’s recession, which began in 2008.

“The headline PMI continued its climb towards the 50.0 threshold as a slower decrease in new orders led manufacturers to moderate their reductions in output, employment and stocks of purchases compared to June,” said Phil Smith, the economist who authored the report on Greece for Markit.

“Although still some way off showing outright stabilisation in the sector, these latest data are at least a stark improvement from those observed at even the start of the year and bring hope that a recovery is on the horizon.”