Euro zone manufacturing activity contracted further during December, private surveys revealed.
Industrial activity in the single currency bloc plunged into further contraction last month as output fell for the first time in 10 months due to a fresh decline in new orders.
The Eurozone manufacturing purchasing managers’ index (PMI), prepared by S&P Global, fell to 48.8 points in December from 49.6 points in November. This is the lowest reading in nine months and is below the 50 point level that separates growth from contraction for the second consecutive month.
The surveys highlighted a general decline in activity in the 20 countries of the euro zone.
Germany, the bloc’s largest economy, posted the worst performance of the eight countries analyzed, with its PMI reading hitting a 10-month low. Italy and Spain returned to contraction territory.
“Demand for euro zone manufactured goods is slowing again,” said Cyrus de la Rubia, chief economist at Hamburg Commercial Bank. “Businesses do not seem able or willing to build momentum for next year, but rather are acting cautiously, which is detrimental to the economy.”
France was one of the few positive exceptions, with manufacturing PMI hitting a 42-month high.
In the United Kingdom, outside the European Union, activity grew in December at its fastest pace in 15 months, driven by a recovery in demand following relief provided by Finance Minister Rachel Reeves’ budget.
