Tuesday, June 5, 2012

Eurozone private sector contracts again in May 2012, 4th month in a row-BBC

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6/5/12, "Eurozone private sector 'contracts again'," BBC

"The eurozone private sector contracted again in May, with activity levels at their lowest for almost three years, a survey has suggested.

The Markit eurozone composite purchasing managers' index (PMI) fell to 46 in May from 46.7 in April. Any figure below 50 suggests contraction.

German output fell for the first time in six months, while declines in Spain and France accelerated.

A drop in new business due to weak demand was the reason for the falls.

The eurozone's private sector has now contracted for four months in a row.

The May figures indicate that "the economy is contracting at the fastest pace for around three years", said Markit's chief economist Chris Williamson....

He reiterated Markit's belief that the eurozone economy could contract by 0.5% in the current quarter, though "a steeper decline could be seen if the June data disappoint".

Job losses were reported for the fifth month in a row, although the rate of decline eased slightly.

The one bright note was the fact that cost pressures eased during the month, thanks to lower commodity prices and wage demands.

The service sector PMI for May was 46.7, down from 46.9 in April, hitting a seven-month low.

Of all the eurozone countries, only Germany reported growth in the sector."

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