23 April 2013 12:40 [Source: ICIS news]
LONDON (ICIS)--The Markit Flash Eurozone Purchasing Managers’ Composite Output Index (PMI) remained at 46.5 in April, indicating that the economic downturn in the eurozone area is likely to worsen in coming months, Markit Economics said on Tuesday.
“Although the PMI was unchanged in April, the survey is signalling a worrying weakness in the economy at the start of the second quarter, with signs that the downturn is more likely to intensify further in coming months rather than ease,” Chris Williamson, Markit’s chief economist said.
The April reading pointed to a 0.4% decline in eurozone GDP during the first quarter of 2013, with downside risks, Williamson added.
“Worryingly, the rate of loss of new business gathered further momentum, suggesting that activity and employment could fall at steeper rates in May,” he added.
The flash data showed that France saw rates of decline in both business activity and new business fall sharply to the slowest for four and eight months, respectively.
Germany saw both activity and new business fall at the steepest rates for six months, financial information services provider Markit said.
“The renewed decline in Germany will also raise fears that the region’s largest growth engine has moved into reverse, thereby acting as a drag on the region at the same time as particularly steep downturns persist in France, Italy and Spain,” Williamson said.
“Policymakers will at least be relieved to see inflationary pressures cooling, which could further open the door to renewed policy stimulus,” he added.
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