The Markit/CIPS Eurozone Manufacturing Purchasing Managers' Index (PMI) fell to a 37-month low of 44.0, down from 45.1 in June; this is a consistent direction of travel to that in the UK . The PMI has now signalled contraction for 12 consecutive months in Europe and is at a 37 month low, whilst Asian Manufacturing PMI also fell to its second-lowest level since April 2009.
Stephen Cooper, UK head of diversified industrials at KPMG, comments on the Markit/CIPS manufacturing PMI:
“The Eurozone crisis and the uncertainty that it creates, is now being directly felt across the world, with the downturn in manufacturing hitting the power-house that was Asia and Germany recording the steepest drop in new orders and the fastest rate of decline since May 2009.
“With the picture not set to get any brighter in the short term, manufacturers have to review their business models and focus on their core businesses. They are already shedding jobs and have followed the route of the retail sector in
cutting their average selling prices for the second month running – but this is not sustainable in the long term.
“As the problems in the Eurozone rumble on, we would expect demand and output both in Europe and Asia to remain challenging, so manufacturers need to think about investing in long-term growth through innovation, partnerships and new markets for top and bottom-line growth.”
Ends
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Notes to Editors:
About KPMG
KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and operates from 22 offices across the UK with over 11,000 partners and staff. The UK firm recorded a turnover of £1.7 billion in the year ended September 2011. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. We operate in 152 countries and have 145,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. KPMG International provides no client services.
