Spain manufacturing PMI

According to a report by Markit Economics, Spain’s manufacturing PMI (purchasing managers’ index) remained unchanged in June. It stood at 53.4 in the month, unchanged from the same figure in May.

June’s PMI figure didn’t meet the preliminary market estimation of 53.6. The figure marked the country’s slowest expansion in manufacturing activity in nine months.

Why Spain’s Manufacturing PMI Was Unchanged in June

The performance of Spain’s manufacturing PMI in June was mainly the result of the following factors:

  • Production volume and output witnessed softer improvement in June compared to May. Factory activity also weakened in the month.
  • Both new business orders and export orders showed their weakest expansion since October 2016.
  • Employment in the manufacturing sector also weakened in the month.

Performances of various ETFs in June

The iShares MSCI Spain Capped ETF (EWP), which tracks Spain’s economic performance, fell 0.5% in June. Similarly, the Vanguard FTSE Europe ETF (VGK), which tracks Europe’s performance (IEV) (N100-INDEX), fell 3.1% in the month.

Rising political instability in Spain and rising trade tensions between the United States and Europe mainly affected Spain’s domestic demand. The United States has imposed a 20% import tariff on all European cars and steel and aluminum exports. The move signaled the potential for a huge imbalance in trade relations between the United States and Europe and affected consumer sentiments in the Eurozone economy.

In the next article, we’ll analyze the final manufacturing PMI of the Eurozone in June.

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