CdM | Growth in the Eurozone manufacturing sector rebounded in April. However, “although the PMI index has reached its highest level in almost four years, the survey is causing more concern than joy”.
Input price inflation rose sharply again, approaching its four-year high. Furthermore, production and the order book were driven by the build-up of safety stocks, “as a result of widespread concerns over supply shortages and rising prices stemming from the war in the Middle East”, according to S&P Global Market Intelligence.
The eurozone manufacturing PMI rose from 51.6 in March to 52.2 in April, and the eight eurozone countries covered by the survey all recorded readings above the 50-point no-change threshold, something that had not happened since June 2022.
In detail, factory output volumes increased in April, marking the thirteenth expansion in the last 14 months. In fact, this latest increase was the most significant since August 2025. A further improvement in demand conditions drove production levels.
The pace of expansion in new orders accelerated from March and was the sharpest in four years. Likewise, new export orders rose at the start of the second quarter, marking the first month of growing demand from overseas customers in just over four years.
According to the surveyed companies, sales growth was boosted by front-loading of purchases, reflecting customers’ expectations of price rises following the energy crisis and supply disruptions caused by the war. In fact, eurozone factories increased their purchasing volumes in April by the largest margin since mid-2022.
The rise in purchasing volumes put pressure on eurozone manufacturers’ supply chains in April. Surveyed firms cited high order volumes, logistical disruptions stemming from the war in the Middle East and reduced availability of raw materials as reasons for the lengthening of supplier delivery times. Delays were the worst since July 2022. Regarding stocks, both input and finished goods stocks fell in April. However, the rate of decline was less pronounced than in March.
Eurozone manufacturers maintained their preference for lower labour capacity, a fact underlined by a further reduction in headcount. Indeed, this decline extended the current run of job losses to almost three years. Employment fell despite the rise in order books.
