(Finance) – Forecast data from the October PMI survey show Eurozone economic activity slightly declining for the second consecutive monthand indicate a marginal decline overall in line with that of September. Output shrank in response to weakening demand, with new orders falling for the fifth straight month. Companies responded to the lower order load by making job cuts at the fastest pace in almost four years, while confidence fell to an 11-month low.
According to preliminary estimates from S&P Global, themanufacturing PMI index it rose to 45.9 points from the previous 45, higher than the 45.1 points expected by analysts. A threshold which remains lower than the critical one of 50 and which still denotes a contraction in activity. Instead, it decreases Services SMEswhich drops to 51.2 points compared to the previous 51.4 points and compares with the expected 51.5 points. Consequently, the Composite PMI it rose to 49.7 points from the previous 49.6, coming in below the consensus (49.8 points).
Among the major European economies, the Germany shows an improvement in the manufacturing PMI to 42.6 from 40.6 points, against a consensus of 40.7 points and an increase in the services PMI to 51.4 from 50.6 (above the expected 50.6). In Francethe manufacturing PMI drops to 44.5 from 44.6 (44.9 points consensus) and the services PMI drops to 48.3 from 49.6 (49.8 was expected).
“THE’Eurozone is stuck in stalematewith the economy contracting marginally for the second consecutive month – he commented Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank – The current slump in manufacturing has generally been balanced by small growth in the service sector. At a national level, there is a worsening of the situation in France combined with a slight moderation of the decline in Germany. For now, it is not clear whether in the near future we will observe a further deterioration or improvement.”
“Even if only slightly, the The eurozone’s service sector continues to grow, helping to maintain near-stable levels in the overall economy. That said, we shouldn’t expect too much in the short term,” he added. “Companies in this sector are seeing lower volumes of new orders, and the level of backlog has contracted for six consecutive months. For the first time since early 2021, service sector hiring has come to a near standstill. The real question to ask is whether the combination of higher wages and lower inflation can revive consumer spending, which in turn would give service industries a much-needed boost.”