Brussels (AFP) – Eurozone business activity slowed in October, coming off a 27-month high in September to highlight concerns the economy is recovering only slowly from recession, a survey showed on Thursday.
The closely-watched Composite Purchasing Manager’s Index (PMI) compiled by Markit Economics fell to 51.5 points in October from 52.2 in September.
Holding above the 50 points boom-bust line, the report suggests the 17-nation eurozone continued to expand at the start of the fourth quarter.
The eurozone escaped a record 18-month recession in the third with growth of 0.3 percent.
The question however is whether the recovery is at risk as the global economy shows no signs of a decisive turn for the better and with authorities, especially in Washington, trying to judge when they can best turn down the stimulus pump.
“The dip in the PMI … is clearly disappointing but it would be unwise to read too much into one month’s data,” Markit chief economist Chris Williamson said in a statement.
At the same time, it “will remind policymakers that a sustainable upturn is by no means assured” and will confirm the European Central Bank’s view that “the recovery is slow, uneven and fragile,” Williamson said.
“Attention is likely to be focused on whether the region requires more policy action to boost the recovery rather than on the timing of any withdrawal of stimulus,” he said.
The slowdown in October was driven by the services sector which typically accounts for 60 percent or more of a developed economy.
The eurozone Services PMI index fell sharply to 50.9 points in October from 52.2 in Sepember, while the Manufacturing PMI edged up to 51.3 points from 51.1.
Copyright 2013 The National Memo