The Eurozone economy has slowed sharply owing to weaker than forecast growth in services and steep falls in manufacturing, particularly in Germany, the results of a closely tracked business survey showed. A poll of Eurozone purchasing managers signalled business activity almost ground to a halt this month, as its composite index fell to a five-month low of 50.1, leaving it only slightly above the 50 mark that separates growth from contraction.
When the European Central Bank held rates last week, president Christine Lagarde said “the risks to economic growth are tilted to the downside”. She noted that services are “leading the way” but manufacturing has “declined in the past few months” and investment also “remains weak”. Price pressures on Eurozone companies picked up at the fastest pace for three months, S&P found.