Italy's manufacturing sector continued to expand during May, but again at a slower rate as signs of softer demand, especially from abroad, translated into weaker gains in output and new orders. Companies nonetheless took on extra staff and were able to make notable inroads into their backlogs of work. On the price front, cost pressures continued to intensify as shortages of stock and rising demand empowered suppliers. Output charges were raised again, but at the slowest rate of the year so far.

The headline IHS Markit Italy Manufacturing Purchasing Managers' Index - a singlefigure measure of developments in overall business conditions - fell to 52.7 during May, down from 53.5 in the previous month and the lowest level for a year-and-a-half. Having hit a near seven-year high of 59.0 at the start of the year, the PMI continues to lose noticeable momentum.