The purchasing managers’ index of euro area was released earlier today. It indicates that the euro area economy is likely to grow only slightly in the second half of 2019, noted Commerzbank in a research report. The purchasing managers’ index for the services sector rose only a bit by 0.2 points to 51.8 in October. The fall of 1.9 points in September was therefore not an outlier. The index for manufacturing stayed at 45.7. This is the lowest value since the end of the recession in 2012.
The service sector, for a long time, was able to decouple from the downturn in manufacturing. However, most recently, there seemed some cracks in this main pillar of the economy. While the sector continues to grow, the pace of growth eased markedly in the summer. This is disconcerting as the recession in the manufacturing sector continues.
“All in all, today's data point to continued weak growth in the euro area economy in the final quarter of 2019. For the third quarter, the hard data available so far suggest only a meagre increase of 0.1% over the previous quarter”, added Commerzbank.
