Growth in the combined private sectors of the 17 countries that share the euro slowed to by fastest rate in two and a half years as manufacturing activity dropped sharply, according to The Wall Street Journal. On Monday, Markit reported that its eurozone output index dropped to 55.4 in May from 57.8 the previous month, marking the lowest level since October and the largest monthly drop since November 2008. The survey showed that the region’s manufacturing purchasing managers’ index dropped over three points to 54.8 while the services gauge slipped more than a point to 55.4, which is the lowest in five months.
The data were seen as being consistent with 0.7% quarterly growth in the second quarter, which is only slightly below the 0.8% expansion posted in the first three months of the year. Markit’s chief economist, Chris Williamson, said that growth in the region “remains very lopsided” as Germany and France power ahead of debt-burden peripheral countries. The survey also showed that job creation was at a four-month low, although the region’s rate of inflation was at the lowest level in four months after a near-record increase in April.