BERLIN: Manufacturing growth in the eurozone slowed further in September as new orders contracted for the first time in over a year on dwindling demand at home and from abroad, a business survey showed yesterday.
Factories also cut prices last month for the first time since April, while preliminary data on Tuesday showed eurozone inflation slowed further in September to just 0.3%, the lowest since the height of the financial crisis.
That underscores the difficulty the European Central Bank (ECB) is likely to have in bringing low inflation back up to its target of just below 2%, especially with low demand for goods and services in a stagnating economy.
Markit’s final September manufacturing PMI came in at 50.3, the lowest since July last year and below both August’s 50.7 and an earlier flash estimate of 50.5. It held above 50 that separates growth from contraction for the 15th month in a row.
“The eurozone’s manufacturing economy has lost the growth momentum seen earlier in the year, lurching closer to stagnation,” said Chris Williamson, chief economist at Markit.
“Order books are now deteriorating for the first time since June of last year, suggesting output could start to fall as we move into the final quarter of the year.” The new orders subindex, which measures demand, fell to 49.3 last month from 50.7 in August, and growth in new export orders slowed slightly.
That came despite the euro weakening to below its 2013 lows and down almost 9% from the peak it hit against the dollar in May. – Reuters