Business growth across the eurozone slowed further last month, according to a survey in which leading indicators suggest the region could slide into decline this quarter as the cost-of-living crisis keeps consumers wary.
The S&P Global Composite Purchasing Managers Index (PMI), seen as a good guide to economic health, dropped to a 16-month low of 52.0 in June from 54.8 in June. May, just above the preliminary 51.9.
Anything above 50 indicates growth.
“The sharp deterioration in the growth rate of eurozone business activity increases the risk of the region falling into economic decline in the third quarter,” said Chris Williamson, chief business economist at S&P Global.
“The manufacturing sector is already in decline for the first time in two years, and the services sector has suffered a sharp loss of growth momentum amid the cost-of-living crisis. Household spending on non-essential goods and services has come under particular pressure due to rising prices.”
The service sector PMI dipped to 53.0 from 56.1, despite slightly above the preliminary 52.8.
The industry PMI released last week showed industrial production fell in June for the first time since the initial wave of the coronavirus pandemic two years ago.
Meanwhile, while inflationary pressures moderated a bit over the past month, the services output price sub-index remained close to a record 63.2, down from 64.6 in May.
Source: CNN Brasil
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