Euro zone manufacturing activity missed forecasts and slowed in November, with German activity contracting — hitting hopes of a pick-up in the bloc’s largest economy.
Markit’s euro zone manufacturing PMI was nearly flat at 50.1 in November, missing analysts’ forecasts of 50.4. This was a fall from the 50.6 recorded in October.
The latest figures will raise concerns among policymakers at the European Central Bank (ECB) who are battling extremely low inflation in the single currency bloc.
Three of the euro zone’s largest economies – Germany, France and Italy – saw manufacturing activity contract in October. Germany’s November manufacturing PMI came in at 49.5, France’s reading was 48.4, and Italy’s figure was at 49, all below the 50 mark that signifies growth.
“With the final PMI coming in below the flash reading, the situation in euro area manufacturing is worse than previously thought. Not only is the performance of the sector the worst seen since mid-2013, there is a risk that renewed rot is spreading across the region from the core,” Chris Williamson, chief economist at Markit, said in a press release.
“The sector has more or less stagnated since August, but we are now seeing, for the first time in nearly one-and-a-half years, the three largest economies all suffering manufacturing downturns.”