EZ manufacturing falls as new orders decline faster - PMI
By Frank Prenesti
Date: Friday 02 Jan 2026
(Sharecast News) - Manufacturing activity in the eurozone fell to a nine-month low as the pace of decline in new orders sped up and production was cut, a survey published on Friday revealed.
The HCOB manufacturing PMI fell to 48.8 in December compared with November's 49.6, while the output index fell into contraction territory at 48.9 from 50.4 - a 10-month low. A mark above 50 indicates expansion.
Demand for euro area goods also saw fresh signs of weakness as new orders fell at the quickest pace in almost a year. HCOB said.
"Nevertheless, surveyed business were their most optimistic towards the year-ahead outlook since immediately prior to Russia's full-scale invasion of Ukraine in February 2022," it added.
HCOB chief economist Cyrus de la Rubia said the fall was characterised by "significantly fewer orders, declining order backlogs, and continued inventory reduction".
"It is not surprising that companies are continuing to cut staff in this environment. Companies seem neither able nor willing to build momentum for the coming year, but are instead exercising caution, which is poison for the economy."
"For 2026, however, there is hope that Germany's economic stimulus program and rising defence spending across Europe will breathe new life into the industry. Many companies obviously see it this way too, as confidence that production will be higher in a year's time than it is today has risen again from an already high level."
Reporting by Frank Prenesti for Sharecast.com
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