Courtesy of Mish.
PMI reports from Europe continue to show severe signs of stress. Yesterday, Markit reported Eurozone PMI rises in June but still signals steep rate of contraction
Key points for June
- Final Eurozone Composite Output Index: 46.4 (Flash 46.0, May 46.0)
- Final Eurozone Services Business Activity Index: 47.1 (Flash 46.8, May 46.7)
- Near-record fall in service sector confidence
The Eurozone economic downturn extended into a fifth consecutive month in June, as the debt and political crises continued to have an adverse impact on both the manufacturing and service sectors.
The spreading of the economic malaise from the periphery of the currency union to its core continued in June. German output contracted at the fastest rate in three years, and France also saw a further decline (albeit slower than in May). Italy and Spain, meanwhile, remained in deep recessions.
Comments:
Chris Williamson, Chief Economist at Markit said:
“The final Eurozone PMI for June picked up slightly on May, but the rise failed to avoid the region seeing the strongest quarterly downturn for three years in the second quarter. The survey points to the economy having contracted by approximately 0.6% in the three months to June.
“Even Germany looks to have fallen into a renewed decline, though only a very modest drop in output is signalled. The pace of downturns in other major euro member states is far more worrying. Output in Italy looks to have fallen by 1% in the second quarter, while declines of 0.6% and 0.5% are signalled for Spain and France respectively.
“Job losses are mounting as a result of falling demand, as companies seek to reduce costs and prepare for the possibility that worse is to come. Service sector companies’ expectations for the year ahead showed one of the largest declines in the history of the survey, pointing to a huge drop in confidence due to the worsening political and economic crises.”
Key Phrase:
…
