Italy manufacturing growth remains strong in August -PMI

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Italy’s manufacturing sector maintained strong growth in August amid strong demand following the relaxation of coronavirus curbs, a monthly business survey showed on Wednesday.

The IHS Markit Purchasing Managers’ Index (PMI) came in at 60.9, up from 60.3 in July and far above the 50 mark that separates growth from contraction. It was the third-highest reading on record, beaten only by the May and June numbers.

August’s PMI, which marked the 14th consecutive month of factory growth, also beat the median forecast of 60.0 in a Reuters survey of nine analysts.

The new orders sub-index climbed to 61.4 from 59.9 in July but was below May’s record high of 64.4.

Unlike the larger services sector, factories in Italy have been spared the restrictions on business and movement imposed to try to rein in COVID-19 infections.

Last year, Italy’s steepest post-war recession saw gross domestic product shrink by 8.9%.

Mario Draghi’s national unity government officially forecasts a partial rebound of 4.5% this year, but recent data has been strong and government officials have said growth of around 5% or higher now looks likely.

Two sources close to the matter told Reuters on Tuesday the government expects the economy to grow by almost 6% this year following confirmation of a strong rebound in the second quarter.