Euro-zone input price inflation at 9-month high squeezing margins

Euro-zone purchasing manager data (Markit) for March showed overall input prices accelerated to a nine month high with raw material prices (largely due to oil) up in both the service and manufacturing sectors. Although input prices rose at their fastest level since June 2011, Markit report that the overall inflation level was close to the 14 year survey average. With output prices remaining subdued businesses across the EZ manufacturers especially are facing a greater squeeze on their margins.

eurozone input prices

Unfortunately for euro-zone manufacturers this is unlikely to be the end of rising input prices. The Economists Euro Index of commodity prices is up a further 2.2% in the past month alone.

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