Reuters :
Euro zone business growth has been weaker than any forecaster expected this month and new orders have fallen for the first time in more than a year despite further price-cutting, a survey showed on Thursday.
Markit’s Composite Flash Purchasing Managers’ Index, based on surveys of thousands of companies and seen as a good growth indicator, fell to 51.4, missing even the lowest forecast in a Reuters poll. “This is going to be a huge disappointment for the European Central Bank. This is the euro zone more or less just continuing to stagnate, a renewed downturn is an increasing likelihood,” said Chris Williamson, survey compiler Markit’s chief economist.
A PMI covering the dominant service industry also missed all predictions in the poll by falling to 51.3, while the factory PMI’s dip to 50.4 missed the median forecast. However, they did hold above the 50 mark that separates growth from contraction. Williamson said the PMI pointed to 0.1-0.2 percent GDP growth in the current quarter, compared with the 0.2 percent forecast in a Reuters poll taken last week.
Forward-looking economic indicators suggest the situation is unlikely to improve anytime soon.
Euro zone business growth has been weaker than any forecaster expected this month and new orders have fallen for the first time in more than a year despite further price-cutting, a survey showed on Thursday.
Markit’s Composite Flash Purchasing Managers’ Index, based on surveys of thousands of companies and seen as a good growth indicator, fell to 51.4, missing even the lowest forecast in a Reuters poll. “This is going to be a huge disappointment for the European Central Bank. This is the euro zone more or less just continuing to stagnate, a renewed downturn is an increasing likelihood,” said Chris Williamson, survey compiler Markit’s chief economist.
A PMI covering the dominant service industry also missed all predictions in the poll by falling to 51.3, while the factory PMI’s dip to 50.4 missed the median forecast. However, they did hold above the 50 mark that separates growth from contraction. Williamson said the PMI pointed to 0.1-0.2 percent GDP growth in the current quarter, compared with the 0.2 percent forecast in a Reuters poll taken last week.
Forward-looking economic indicators suggest the situation is unlikely to improve anytime soon.
