Manufacturing PMI down in May amid demand weakness

ISTANBUL

Türkiye’s manufacturing sector saw a mild contraction in May as weak demand continued to weigh on output, employment and purchasing activity, according to data released by S&P Global Monday.

The country’s manufacturing purchasing managers’ index (PMI) slipped slightly to 47.2 in May from 47.3 in April, remaining below the 50-point threshold that separates expansion from contraction. This marks the 14th consecutive month of declining business conditions in the sector.

“The index pointed to a further solid monthly easing of business conditions in the manufacturing sector,” S&P Global said in a statement.

"The health of the sector has now moderated in each of the past 14 months."

New orders, a key indicator of demand, declined for the 23rd straight month and did so at a solid pace in May. The subdued market environment also prompted manufacturers to reduce staffing levels and scale back purchasing activity more significantly than in the previous month.

"Employment and purchasing activity were also scaled back to larger extents than in April, while manufacturers reduced their inventories of both purchases and finished goods," it noted.

Production levels declined further, with the latest slowdown being the sharpest since October 2023, driven by ongoing weak demand and inflationary pressures.

"It was a familiar story for the Turkish manufacturing sector in May, with the PMI data showing similarly paced moderations in a range of key variables as in recent months," said Andrew Harker, economics director at S&P Global Market Intelligence.

"Firms will be hoping that growth can be kick-started in the near future. There were at least some signs of inflationary pressures easing over the month which could provide some respite for manufacturers," he added.