- May manufacturing PMI 51.2 vs 52.0 expected
- Prior 51.7
April was defined by firms rushing orders to stock up, so naturally May is showing some of that unwinding as new orders placed
with manufacturers declined. The standout details from the report though are that supply chain delays are intensifying as product shortages were
reported, and also input prices rising further to a greater degree.
The former sees a further deterioration in vendor times, which was the greatest seen in
four years, as the Middle East conflict continues to weigh. The report points out that: “Panellists
noted that delays on maritime routes were considerable,
product shortages widespread and prices for inputs,
especially for oil and oil-derivatives were rising precipitously.”
And on the inflation front: “Prices paid
for inputs by manufacturers rose to the greatest degree for
four years and amongst the strongest rates in the survey
history. The acceleration in inflation seen in the past three
months has also been unprecedented since data were first
collected in early 1998.”
As higher input cost inflation becomes more embedded, selling charges also increased on the month as firms look to try and protect their margins further. Of note, the degree of charge inflation remains elevated in the context of the survey history even if a little softer than April’s near three-and-a-half year
high.
This article was written by Justin Low at investinglive.com.
