Greece’s manufacturing sector regained momentum in May, as production and new order growth accelerated, despite ‘significant’ cost pressures, according to the latest S&P Global Greece Manufacturing PMI survey.
Greece’s headline Purchasing Managers’ Index rose to 53.3 for the month, compared to 52.4 in April, indicating a solid expansion in manufacturing activity.
‘Renewed momentum’
“The Greek manufacturing sector saw renewed momentum in May, as growth rates for production and new sales regained speed,” commented Siân Jones, principal economist at S&P Global Market Intelligence. “Subsequently, job creation accelerated and business confidence picked up.”
The survey found that both output and new order growth accelerated during the month after losing momentum in April, supported by stronger domestic demand and successful customer outreach. Export orders, however, continued to decline for a fourth consecutive month.
Manufacturers also increased hiring at the fastest pace in four months as firms sought to expand capacity amid stronger workloads. Outstanding business returned to growth after a slight decline in April, with supply shortages and sourcing difficulties contributing to rising backlogs.
Despite the stronger activity levels, manufacturers continued to face mounting inflationary pressures linked to the ongoing conflict in the Middle East. Companies reported severe supply chain disruption due to rerouted logistics routes, while higher oil and energy prices drove input costs sharply higher.
“The war in the Middle East continued to place strain on the sector as the latest upturn in input buying was stymied by severe disruption to supply chains, while cost pressures escalated further,” said Jones. “Although plans to build safety stocks were highlighted by panellists, efforts were broadly scuppered by challenges in replenishing items used during the month.”
Input cost inflation
According to the survey, input cost inflation accelerated to its steepest pace since June 2022, while factory gate prices increased at the fastest rate since October 2022 as firms passed higher costs on to customers.
Supply chain disruption also hampered efforts to build precautionary inventories. Supplier delivery times lengthened at one of the sharpest rates since late 2022, while shortages of raw materials slowed purchasing growth to its weakest pace in almost a year.
“Sustained customer demand allowed firms to raise selling prices again in May, and at a faster pace,” Jones added. “Meanwhile, the latest forecast from S&P Global Market Intelligence expects inflation as measured by the Consumer Price Index (CPI) to increase by 4.2% in 2026.” Read more here.
