LONDON (Reuters – Although manufacturing activity remained high in the euro area last month, supply chain bottlenecks caused by logistical and logistics problems led to input cost spikes that slowed growth and increased costs. A survey was released on Tuesday.

The coronavirus pandemic and a shortage in heavy-duty vehicle drivers have caused ongoing disruptions that resulted in product shortages. This has left many factories unable to obtain the raw materials they require.

IHS Markit’s last manufacturing Purchasing Managements’ Index (PMI), fell 8.3% to 58.3 October, from September’s 58.6, a little below the initial 58.5 flash estimate. But it was still above 50 which separates growth from contraction.

The output index, which feeds into the composite PMI due Thursday, fell to 53.3 in September from 55.6. This is its lowest reading since June 2013.

Chris Williamson from IHS Markit, chief business economist, stated, “Eurozone manufacturers reported a worsening in the supply chain position in October, which cut production growth sharply during that month.”

“The average delivery time of raw materials was extended at a rate exceedingly high in nearly a quarter-century of survey data.” Companies report that they are seeing demand outpacing supply as they continue to receive more inputs.

These shortages allowed suppliers to increase their prices, and the index of input prices jumped to 89.5, from 86.9. This is the highest level since mid-97, when the survey started.

Official data last week showed that inflation has exceeded expectations. The bloc’s economy saw a continued boom in the summer, as activity recovered from coronavirus lockdowns.

Christine Lagarde of European Central Bank acknowledged Thursday that inflation was likely to remain high, but he resisted the market’s bets that prices will cause an ECB increase in interest rates as soon as next season.