PMI indices point to euro zone recession in third quarter

(Boursier.com) — The latest flash PMI data show a deepening contraction in the eurozone private sector in September. Overall activity fell for a third consecutive month, with the decline accelerating compared to August. The composite Flash PMI index of overall activity in the euro zone thus fell from 48.9 to 48.2, to a 20-month low.

The Flash PMI index for services activity came out at 48.9 (49.8 in August and 49.1 consensus), on a 19-month low, while the Flash PMI index for manufacturing industry reached 48.5 (49.6 in August and 48.8 consensus), the lowest for 27 months.

Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, commented on the latest survey figures: “An economic recession is looming in the Eurozone, with companies in the region reporting a deterioration in the economy as well as an increase in inflationary pressures, linked to a surge in the cost of energy.The advance estimate of PMI data for September shows a level in line with a contraction in GDP of 0.1% in the third quarter, the decline in activity intensified throughout the past three months to signal the region’s weakest economic performance since 2013 (barring those recorded during recent lockdowns).