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Italy December PMI remains buoyant

MILAN: Italy's manufacturing economy continued to expand in December with output, new orders and employment all still buoyant, according to the latest PMI survey published on Monday.

The seasonally-adjusted Purchasing Managers' Index (PMI) recorded 56.6 in December, showing the sixth consecutive monthly expansion of the manufacturing economy although at a slightly slower rate than November's 57.1.

The improvement of economic conditions in Italy and recovery of foreign markets again resulted in an increase in new orders from both domestic and international markets during the month, the survey showed.

Those firms recording an increase in export orders reported they had particularly benefited from the recovery of demand from the German, North American and Far Eastern markets.

In line with the sustained strengthening of order books, panel companies raised production and hired new staff in December.

Purchasing managers continued to increase volumes of raw materials and semi-manufactured goods bought in December in order to expand capacity, and some panel firms said they increased purchases during the month to build stocks to guard against possible delivery delays at the start of the new millennium.

Rising demand for, and shortages of, a wide range of materials in December placed further upwards pressure on average input prices.

Moreover, panel firms continued to stress that both the strength of the dollar against the euro and higher oil prices continued to have inflationary effects on input prices.-Reuters