Spain's factory activity expands in September as price pressures mount

• Spain's manufacturing purchasing managers' index for September stood at 51.0, above the 50.1 forecast.
• The prior month's reading was 49.5.

September saw Spain's manufacturing sector move back into expansion, though underlying conditions stayed weak.

Data details revealed higher production, but total new work kept falling due to persistent uncertainty and price increases, notably for energy. New orders dropped for the fifth month in a row, albeit at a slight pace. Manufacturers pointed to uncertainty and the damaging effect of rising prices on demand, noting that prices were rising sharply once more.

In September, input and output prices both rose at faster-than-trend rates. This adds to inflation worries for the European Central Bank's considerations.

Input cost inflation reached its highest in four months, leaving firms with little option but to increase their own prices. As a result, output price inflation hit a three-month peak, though limited somewhat by competition.

Supply-side issues persisted in September, adding to inflationary pressures. Input delivery times continued to extend at a historically sharp rate, which companies attributed to delays on major shipping routes and low stock at suppliers.

By itself, this data covers just one segment of the euro zone economy. Its significance for the ECB's outlook is therefore limited on its own. The key issue is whether the PMIs for major countries and the euro zone as a whole show a similar trend of economic improvement and, more critically, whether price pressures are becoming more worrying.