Manufacturing Growth in Spain, Turkey, and France Shows Mixed Trends

In November, Spain’s manufacturing growth slowed due to severe flooding in the Valencia region, impacting output and new orders. The HCOB Manufacturing Purchasing Managers’ Index (PMI) for Spain dropped to 53.1, down from 54.5 in October. Despite this dip, Spain’s manufacturing sector continued its growth streak for the 10th consecutive month, bucking the trend seen in much of Europe. Exports surged, with new export orders reaching the highest rate since September 2021, while inflationary pressures seemed to stabilize. Business confidence also rose to its highest level since May.

Meanwhile, Turkey’s manufacturing sector showed signs of recovery. The Istanbul Chamber of Industry Türkiye PMI improved to 48.3 from 45.8 in October, signaling a slowing contraction. The decline in output was the smallest since April, and job creation rose at its fastest rate since July 2023. However, challenges in securing new business persisted, and export demand remained sluggish. The slow but steady recovery in Turkey contrasts with the more pronounced slowdown in France.

France manufacturing sector faced a sharp decline, with the PMI falling to 43.1, marking its lowest point since January. This decline, which is part of a 22-month streak of contraction, was driven by weakened demand both internationally and domestically. New orders plummeted, particularly from Germany and the US, and sectors such as construction, automotive, and cosmetics were especially affected. As a result, companies focused on protecting cash flow, leading to cuts in inventory and purchasing activities.

German Manufacturing Struggles with Weak Demand and Rising Pressures
Germany’s manufacturing sector remained under pressure in November, with the PMI holding steady at 43.0, indicating continued contraction. While the rate of decline in output slowed compared to October, demand remained weak. New orders, output, and employment continued to fall, and companies experienced greater competitive pressures, which contributed to drops in output prices and input costs. Although business expectations showed a slight improvement for the second month in a row, economic and political uncertainties continued to weigh heavily on confidence.