ECONOMIC activity in the Eurozone fell again in March, influential survey data showed yesterday, indicating the economy will contract in the first quarter of the year, taking the area into a technical recession.
German output growth slowed, while economic activity fell in France and declined sharply for the rest of the currency union combined, according to initial purchasing managers’ indices (PMI) data from Markit.
For the Eurozone as a whole, the manufacturing PMI declined from 49 to 47.7, and the services figure fell from 48.8 to 48.7 – both below the no-change level of 50, showing output fell even faster in March than in February.
The composite index, representing both sectors, fell from 49.3 to 48.7, indicating the contraction is deepening, not improving.
The index for employment fell to its lowest level since March 2010, and new business in manufacturing fell for the tenth consecutive month.
“The Eurozone is far from out of the economic woods and is finding it hard to return to growth after GDP contracted by 0.3 per cent quarter-on-quarter in the fourth quarter of 2011,” warned Howard Archer, economist at IHS Global Insight.
“The region is still facing major headwinds, notably including increased fiscal tightening in many countries, rising unemployment, and increased oil prices.”