The eurozone manufacturing sector fell deeper into contraction in July, with manufacturing purchasing managers index data signaling the sharpest decline in production since the pandemic lockdowns of May 2020.
The S&P Global eurozone manufacturing PMI fell below the crucial 50.0 mark in July to 49.8 from 52.1 in June, signaling the first deterioration in overall manufacturing sector conditions for just over two years.
“Eurozone manufacturing is sinking into an increasingly steep downturn, adding to the region’s recession risks,” Chris Williamson, chief business economist at S&P Global Market Intelligence said in a note.
New orders are already falling at a pace which, excluding pandemic-lockdown months, is the sharpest since the debt crisis in 2012, with worse likely to come, Mr. Williamson said.
The economist said one upside to the weakened demand environment is an easing of supply constraints, with the incidence of delays now the lowest since late-2020.
This has in turn helped to alleviate price pressures considerably in July, as both input cost and output price inflation rates slowed, S&P Global said.
Write to Maria Martinez at firstname.lastname@example.org