Eurozone downturn deepens at start of Q4, data shows

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Data from Markit has revealed that the eurozone downturn deepened at the beginning of the fourth quarter.

The financial data providers Markit Eurozone PMI Composite Output index fell to 45.7 in October, down from 46.1 in September and lower than an earlier flash estimate.

The downturn in the combined manufacturing and services output has confirmed overall activity has fallen for nine consecutive months.

Markit senior economist Rob Dobson says: “Sentiment is still being hit hard as companies worry about the dual impact of weak domestic demand and a slowing global economy.

“This is likely to hit growth in the coming months, especially at a time when cost-caution at manufacturers and service providers is filtering through to the wider economy through rising job losses, reduced purchasing and inventory depletion.”

Steep contractions were seen in Spain, France and Italy, although the rate of decline has slowed.

Dobson says: “The downturn is still widespread, with all of the big four economies seeing output decline in October. Signs that the contraction in Germany gathered pace are particularly disappointing, given the important role a strong performing Germany could play in stimulating growth elsewhere in the currency zone.”

He adds: “Ireland was the only real brighter spot in October, with growth improving as it continues to make up lost ground.”