City AM: Eurozone recession risk 'very real' as slowdown infects services sector

03 October 2019

Germany slipped into recession territory last month as the Eurozone teetered on the brink of stagnation, data by the IHS Markit’s Germany Composite PMI revealed.

The bloc’s biggest economy showed the weakest growth in business activity for three years, according to IHS Markit’s Germany Composite PMI.

“A technical recession now looks to be all but confirmed,” IHS Markit principal economist Phil Smith said.

Meanwhile the Eurozone barely grew at all, registered a score of 50.1, just above IHS Markit’s 50 no-change mark.

Inflows of new business dropped at the fastest rate for more than six years, while employment growth hit its lowest level since early 2016.

A global manufacturing downturn and prolonged Brexit uncertainty meant confidence was close to August’s 75-month low, too.

“The Eurozone economy ground to a halt in September, the PMI surveys painting the darkest picture since the current period of expansion began in mid-2013,” IHS Markit’s chief business economist, Chris Williamson, said.

“The risk of recession is now very real,” he added.

Manufacturing remained the Eurozone’s weakest sector, having suffered its worst month in seven years in September.

But IHS Markit warned the industry’s downturn is now infecting the services sector, which has posted one of its weakest growth rates for six years. [...]

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IHS Markit Eurozone Composite PMI

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