BRUSSELS (Reuters) – Manufacturing activity in the euro zone contracted in June faster than initially estimated amid tighter monetary policy by the European Central Bank (ECB), a survey shows that paints an outlook. increasingly bleak for the industrial sector.
Final purchasing manager survey results released by S&P Global/Hamburg Commercial Bank on Monday show the manufacturing PMI came in at 43.4, its lowest since the start of the COVID-19 pandemic, against 44.8 a month earlier and 43.6 in the first estimate.
An index measuring production fell to 44.2, an eight-month low, after 46.4 the previous month.
“There is growing evidence that the capital-intensive industrial sector is reacting negatively to ECB interest rate hikes,” said Cyrus de la Rubia, chief economist at Hamburg Commercial Bank.
Anxious to curb high inflation, the ECB has raised the cost of money by a total of 400 basis points since July 2022, bringing its deposit rate to 3.50% in June, which weighs on purchasing power. indebted consumers and businesses.
The PMI survey also shows demand weakening at the fastest pace in eight months despite deeper price cuts on manufactured goods, so factories, which have become more cautious, have cut staff to the first time since the start of 2021. The employment index in the sector fell to 49.8 in June from 51.5 a month earlier.
(Report Jonathan Cable; Claude Chendjou, edited by Kate Entringer)
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