{"id":184655,"date":"2023-12-12T11:59:07","date_gmt":"2023-12-12T11:59:07","guid":{"rendered":"https:\/\/precoinnews.com\/?p=184655"},"modified":"2023-12-12T11:59:07","modified_gmt":"2023-12-12T11:59:07","slug":"eurozone-private-sector-slowdown-continues","status":"publish","type":"post","link":"https:\/\/precoinnews.com\/business\/eurozone-private-sector-slowdown-continues\/","title":{"rendered":"Eurozone Private Sector Slowdown Continues"},"content":{"rendered":"
The euro area private sector downturn continued in November with the sustained decline in new business<\/span> signaling a shallow recession in the region towards the end of the year. <\/p>\n The HCOB composite output index registered 47.6, up from a 35-month low of 46.5 in October, the purchasing managers’ survey results from S&P Global revealed on Tuesday. <\/p>\n Moreover, the score was also above the flash level of 47.1 and hit the highest since July. <\/p>\n The services Purchasing Managers’ Index advanced to 48.7 from 47.8 in the previous month. The flash reading was 48.2. <\/p>\n Factoring in the latest PMI indicators, GDP nowcast suggests that a fall in GDP is on the cards for the fourth quarter and the economy<\/span> is on the brink of recession, Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, said.<\/p>\n Demand for goods and services remained a major drag on business activity. Orders from non-domestic clients faltered after orders received from external sources declined sharply. <\/p>\n Falling receipts of new work prompted companies to make additional inroads into their backlogs. Outstanding orders across the private sector declined strongly. <\/p>\n Further, employment decreased for the first time in nearly three years. The drop exclusively reflected job losses at manufacturers as services companies registered a slower expansion in staffing capacity.<\/p>\n There was a slight intensification of price pressures. <\/p>\n Input prices grew sharply and at the joint-fastest pace since May. While manufacturers’ expenses continued to fall, input cost in the service sector declined. <\/p>\n Consequently, output charge inflation ticked up in November. <\/p>\n Growth expectations edged up slightly in November and the positive sentiment was subdued by historical standards.<\/p>\n “The ECB confronts a pivotal decision: continue with interest rate hikes or place faith in the ongoing transmission of these hikes to prices,” HCOB’s chief economist Rubia said.<\/p>\n “As of now, indications suggest a strong bias towards the latter choice,” <\/p>\n All big four economies of the currency bloc reported contractions in November.<\/p>\n France was the worst performer. Germany and Italy reported a slowdown in their downturns, while Spain’s private sector shrank for the first time since August. <\/p>\n Germany’s final composite output index advanced to 47.8 in November from 45.9 in October. The score suggested the slowest pace of contraction in four months. <\/p>\n The German services PMI posted 49.6, up from 48.2 in October and the initial score of 48.7. <\/p>\n France’s private sector shrank again in November. The composite output index held steady at 44.6 compared to the flash estimate of 44.5. <\/p>\n The services PMI rose slightly to 45.4 from 45.2 a month ago and remained slightly below the initial estimate of 45.3. <\/p>\n With sustained contractions in both manufacturing and services output, Italy’s private sector registered a sixth straight month of contraction. <\/p>\n But the composite indicator improved to 48.1 from 47.0 in October. The services PMI picked up to 49.5 in November from October’s year-low of 47.7.<\/p>\n Spain’s private sector shrank for the first time in three months in November. <\/p>\n The composite index dropped to 49.8 in November from 50.0 a month ago. The services PMI registered 51.0, little changed from 51.1 in the prior month. <\/p>\n