Italian Industry Continued To Slump In July According to PMI

Italy's manufacturing sector contracted for a fifth straight month in July, posting its weakest performance in over six-and-a-half years and casting a deepening shadow over future growth prospects, according to the results of the latest Markit/ADACI PMI survey out this morning. The Markit Purchasing Managers Index dropped to 45.3 from June's 46.9, sinking further below the 50 divide between growth and contraction.



Order books and output both contracted at their fastest pace for over six-and-a-half years, compounded by a two-year high rate of input price inflation. In the latest PMI survey, employment contracted for the sixth consecutive month and at its fastest rate since July 2005, while input prices were the strongest since July 2006.

Italy's EU-harmonised consumer price inflation rose to a record high of 4.1 percent year-on-year in July, broadly in line with expectations and the same rate as for the euro zone as a whole despite Italy's weaker economic growth.