European manufacturers are facing at the moment," said Chris Williamson, chief economist at data compiler NTC. But he added there were warning signs for the months ahead: "Order books are beginning to stagnate, and it's a pretty stark contrast when you compare it to even January's figure."
The output index tumbled to 53.4 last month, its lowest since October, from 56.0 in February. The slowdown in manufacturing growth was accompanied by price pressures that saw firms struggle to handle rising costs while keeping factory gate prices competitive. Input prices jumped to a 20-month high in March, rising to to 74.7 from February's 68.8, while output prices fell to a three-month low of 57.3.
"Over half of all firms recorded a rise in costs during the latest survey period, which they attributed to higher prices paid for oil, steel and general raw materials," NTC said in a statement. "Faltering demand and competitive pressures were cited as factors limiting pricing power and contributing to an easing in the rate of charge inflation to the lowest in three months," it said.