Raw material costs rose at the sharpest rate since May 2022, driven by higher energy and raw material prices associated with supply disruptions due to conflict in the Middle East. In response, manufacturers raised prices for their products at the fastest pace in three and a half years.
This is reported by ProInvesting, citing a source of business surveys. Supply chain delays worsened in May, reaching the longest delivery times since June 2022. These delays had a positive impact on the overall PMI, as historically longer delivery times correlate with higher manufacturing activity.
Factory employment continued to decline in May, extending a period of layoffs that has lasted three years. Despite the job cuts, manufacturers reduced unfinished orders for the first time since February.
Purchasing activity in raw materials and intermediate goods increased for the third consecutive month, albeit at a modest pace. Inventories of purchased goods declined due to persistent delivery delays.
Some 3,000 manufacturers from Germany, France, Italy, Spain, the Netherlands, Austria, Ireland and Greece participated in the survey. The data was collected from May 12 through May 21.
