It is more and more recession for the Eurozone. In October, the Markit PMI index on production fell to 47,2 points, from 49,1 recorded in September. The flash manufacturing PMI index fell from 48,5 to 47,3 points. These are the lowest levels since July 2009.
The numbers reflect a weakening of the demand for goods and services. New orders fell for the third consecutive month, recording the largest contraction since June 2009. Manufacturers, on the other hand, suffered a decline in new orders for the fifth consecutive month, with the rate of decline at the highest level since May 2009. As for new export orders, they fell for the fourth consecutive month with the fastest decline since June 2009.
“The PMI shows an increased risk of the euro zone falling back into recession – commented Chris Williamson, Chief Economist for Markit -. The economy began the fourth quarter with an accelerating rate of contraction to the highest since July 2009. Forward-looking indicators, such as the further lowering of service sector growth forecasts over the next twelve months and employment to near-stagnation levels, suggest that companies are preparing for the situation to continue to deteriorate.
Furthermore, the contraction “is not taking place only in peripheral countries – continued Williamson -. France saw a decline in private sector output for the first time in more than two years, triggered by a worrying sharp deterioration in the tertiary sector. Meanwhile, the manufacturing sector of Germany (leading country for the recovery of the region) is now also in decline. The only positive note seems to be the sharp easing of price pressures that accompanied the crisis, especially in manufacturing, where input prices fell for the first time in over two years”.
