Eurozone business activity faces 2nd downturn in 3 months

Eurozone business activity contracted again in November, as weak demand and declining new orders pushed the region’s economy into its second downturn in three months.

The HCOB Flash Eurozone Composite PMI dropped to 48.1 from 50.0 in October, signalling the most significant decline since January.

Both the service and manufacturing sectors saw output shrink, with manufacturing experiencing a sharper contraction.

New orders decreased for the sixth consecutive month, and export demand fell sharply, marking the largest drop in foreign business since the end of 2023.

Business sentiment also fell to its lowest level in over a year, with pessimism rising in France.

Employment continued to decline in manufacturing, but services saw a modest increase in staffing. Companies scaled back purchasing activity, leading to a notable reduction in inventories.

While inflationary pressures on input and output prices increased slightly, they remained below average levels for the year.

Attribution: S&P Global

Subediting: Y.Yasser