MADRID (Reuters) - Factory activity in Spain picked up some speed in May, a survey showed on Wednesday, although rising production costs and geopolitical uncertainty weighed on sentiment among businesses.
S&P Global (NYSE:SPGI)'s Purchasing Managers' Index (PMI) for manufacturing stood at 53.8 in May, up from 53.3 in April and 54.2 in March and still comfortably above the 50.0 mark that separates expansion from contraction.
"Price pressures remained considerable, whilst expectations for output were somewhat muted by concerns over inflation and geopolitical uncertainty," S&P Global said in a report.
"Panellists reported little choice but to pass on their own escalating costs through a rise in factory gate prices, but this was having a detrimental impact on sales," S&P Global's economist Paul Smith said in the report.
Rising inflation and uncertainty from the Ukraine war have prompted Economy Minister Nadia Calvino to slash her economic growth outlook for this year to 4.3% from 7% after a slower-than-expected growth of 5.1% in 2021.
Spain's central bank has also reduced its growth expectation for the year, to around 4%.