Netherlands manufacturing virtually unchanged in May
The PMI thus remained comfortably above the 50-point threshold that separates expansion from contraction in the manufacturing sector.
May’s result reflected a strong expansion in output and new orders, with Dutch firms enjoying buoyant demand for their products, both at home and abroad.
This pushed manufacturers to increase their purchasing activity and hire more staff, which contributed to the first decline in backlogs of work in seven months.
Regarding price developments, input price growth eased somewhat to a seven-month low, despite still remaining fairly elevated due to higher raw material prices and rising wages. Higher prices for inputs were passed through to final consumers in the form of higher output prices.
Sam Teague, Economist at IHS Markit, commented, “The latest PMI data indicate that the Dutch manufacturing sector continued to grow sharply midway through the second quarter.
“Overall, the sector remains on track to support expected GDP growth of 2.2% in 2017, according to IHS Markit forecasts.”
FocusEconomics Consensus Forecast panelists see fixed investment rising 3.5% in 2017, which is up 0.3 percentage points from the previous month’s estimate. For 2018, the panel expects fixed investment to increase 3.1%. ■