Eurozone Manufacturing Sector Weakens in November As Demand Falls
GlendonThe eurozone manufacturing sector weakened in November as new orders fell, according to the latest HCOB Eurozone Manufacturing PMI data released Monday.
The eurozone manufacturing sector weakened in November as new orders fell, according to the latest HCOB Eurozone Manufacturing PMI data released Monday.
The headline PMI dropped to 49.6 in November from 50.0 in October, falling below the crucial 50.0 threshold that separates growth from contraction. This marked a five-month low and signaled a renewed deterioration in factory conditions across the eurozone, though the decline was only marginal.
The Manufacturing PMI Output Index also decreased to 50.4 from 51.0 in October, hitting a nine-month low while still indicating slight growth.
A stark contrast emerged between the eurozone's two largest economies and the rest of the bloc. Germany and France both saw their PMI readings fall to nine-month lows at 48.2 and 47.8 respectively, while Ireland led growth with a reading of 52.8, followed by Greece at 52.7.
New orders, the most heavily weighted component of the PMI, decreased after stabilizing in October. Export orders fell for the fifth consecutive month, highlighting continued challenges in overseas markets.
Despite these headwinds, manufacturing output growth continued for the ninth straight month, though at the weakest pace during the current upturn. Companies pursued more aggressive retrenchment strategies, with employment, purchasing, and inventories all falling at steeper rates than in October. Job losses were the sharpest since April.
Supply chain pressures intensified, with suppliers' delivery times lengthening to the greatest extent since October 2022. This contributed to a marked increase in input costs, the sharpest since March, following relatively stable prices throughout 2025.
"The current picture of the eurozone is sobering, as the manufacturing sector is unable to break out of stagnation and is even tending towards contraction," said Dr. Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank.
However, business confidence improved, with sentiment rising above its historical average to the highest level since June. Dr. de la Rubia noted that "most companies in the eurozone are confident that they will be able to expand their production in the next twelve months," with improved mood in Germany and a shift from pessimism to optimism in France.
