Eurozone manufacturing PMI continues to decline in July

By Muhammed Ali Gurtas

ANKARA (AA) - The euro area’s manufacturing sector continued to contract during July, according to a London-based global data company on Thursday.

IHS Markit reported that the eurozone manufacturing Purchasing Managers’ Index (PMI) contracted at the fastest rate since December 2012 to stand at 46.5 points last month, down from June's 47.6.

"Of the three market groups categories covered by the survey, ongoing contractions were seen in the intermediate and investment goods sectors," it said. "For the latter, the deterioration was the greatest since November 2012."

In contrast, the data company noted that growth was sustained among producers of consumer goods.

As a critical measurement to indicate the health of the manufacturing sector, the monthly PMI indices -- based on surveys and national data -- show a growth with a value above 50 points, a contraction with a level below 50 points, compared to the previous month.

"Germany remained a source of weakness, with its manufacturing economy recording its sharpest deterioration in operating conditions for seven years.

"Austria recorded its lowest PMI level in just under five years, whilst there were also below 50.0 readings seen in France, Ireland, Italy and Spain," it said.

The monthly report showed that the downturn in the overall manufacturing economy was driven by a sharp fall in new orders.

"Latest data showed that the decline was the second sharpest recorded by the survey in just over six years -- surpassed only by a contraction in March.

"... As ongoing trade tensions, difficulties in the automotive industry and political uncertainties continued to weigh on demand both in internal and external markets," it added.