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The blows keep coming for Greece.
Greek manufacturers suffered their worst month since September 2015 according to a closely-watched business survey which revealed the detrimental impact of heavy snowfall on the country’s factories at the start of the year.
Markit’s purchasing manager’s index for Greek manufacturers – which measures output, employment and expectations in the sector – dropped to 46.6 last month from 49.3 in December.
That is the lowest figure in 16 months – the aftermath of the country’s agreement to a third international bailout – and indicates the sector shrunk for a fifth consecutive month (any figure below 50 marks contraction).
The survey comes as the future of the country’s €86bn bailout is looking increasingly precarious. Greek bonds and stocks have been hit hard this week after the International Monetary Fund ramped up its warnings over the country’s “explosive” debt dynamics.
The IMF is due to make a final decision on whether to pump fresh funds into its largest ever debtor country early next week.
Falling factory output and heavy snowfall was coupled with the highest rate of producer inflation seen in almost six years, “compounding the current misery for goods producers”, said Samuel Agass, economist at Markit.
Chart via Bloomberg