Eurozone: PMI falls to over four-year low in December
December 14, 2018
Leading data suggests that the Euro area’s economy ended the year on a weak note. The Eurozone Composite Purchasing Managers’ Index (PMI), produced by IHS Markit, fell from November’s 52.7 to 51.3 in December—the worst result since November 2014. Despite the fall, the composite PMI lies above the 50-threshold, signaling expanding business activity in the Eurozone.
Both the manufacturing and services sectors PMIs fell in December, leading to the decrease. New business inflows stuttered in December and employment growth fell to a two-year low. Weak demand was seen both at home and abroad with new export orders recording the sharpest drop seen on record and protests in France disrupting business activity in the Eurozone’s second-largest economy. On the price front, output price inflation eased but remained elevated due to firm commodities prices.
Regarding the two largest Eurozone economies, Germany’s composite output index fell to an over four-year low. Similarly, France’s plunged to a 30-month low hit by the ‘yellow vests’ protests.