LONDON (Reuters) – The slowdown in euro zone economic activity eased last month, but the bloc’s economy could contract again this quarter as the services sector faces weak demand, according to a survey.
Over the past quarter, the economy contracted 0.1%, according to Eurostat, and the S&P Global/HCOB composite PMI for November, released Tuesday, shows the bloc on track to recover. contract again this quarter, the technical definition of a recession.
The composite PMI, considered a good indicator of overall economic health, rose to 47.6 from 46.5 in October, its lowest level in almost three years, compared with a preliminary estimate of 47.1 .
It was its best reading since July, but the index remains well below the 50 mark that separates growth from contraction.
The PMI for the services sector rose from 47.8 in October to 48.7 in November.
“The services sector continued its fall in November. The modest improvement in the index does not leave much room for optimism about a rapid recovery in the immediate future,” said Cyrus de la Rubia, chief economist at the Hamburg Commercial Bank.
“Added to these worrying prospects is the fifth consecutive monthly drop in new orders: a drop in GDP is expected for the fourth quarter.”
The index measuring new orders, a gauge of demand, remained below 50 for the fifth consecutive month, although it recovered slightly from 45.6 in October to 46.7.
However, the sentiment indicator for 2024 improved, with the composite future output index rising from 55.6 to 56.0.
(Report Jonathan Cable, Corentin Chappron, edited by Blandine Hénault)
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