Euro zone business activity declined for a fifth month in November, suggesting the economy was sliding into a mild recession as consumers cut spending amid surging inflation, a survey showed.
S&P Global’s final composite Purchasing Managers’ Index (PMI) for the euro zone, seen as a good guide to economic health, nudged up to 47.8 in November from October’s 23-month low of 47.3, matching a preliminary estimate.
“A fifth consecutive monthly falling output signalled by the PMI adds to the likelihood that the euro zone is sliding into recession,” said Chris Williamson, chief business economist at S&P Global Market Intelligence.
“However, at present the downturn remains only modest, with an easing in the overall rate of contraction in November means so far the region looks set to see GDP contract by a mere 0.2%.”
Economists gave a median 78% chance of a recession in the bloc within a year in a Reuters poll last month and predicted the economy would contract 0.4% this quarter.
With demand falling again and scant prospect of an imminent turnaround firms scaled back on hiring – the employment index slipped to 51.8 from 52.5. Unemployment in the region dipped to 6.5% in October, official data showed on Thursday.
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