Markit's Eurozone Manufacturing Purchasing Managers Index (PMI) was at 52.3 points in January this year, down from December’s 53.2 points and in line with the earlier flash estimate of 52.3 points.
The euro zone manufacturing sector started 2016 on a softer growth, with rates of expansion in output, new orders and new export business all easing during January. Despite the slower pace of growth signaled by the latest survey, the outlook for the manufacturing sector remained mildly positive overall. Input cost pressures also remained heavily toward the downside, as purchase prices fell at one of the fastest rates during the past six-and-a-half years.
Euro zone manufacturing production rose at the slowest pace for four months, as the rates of growth in both total new orders and new export business eased to the weakest since last September.
“The euro zone’s manufacturing economy missed a beat at the start of the year. Having accelerated for three straight months, the rate of growth slipped from the 20-month high attained at the end of 2015. Growth of order books, exports and output all slowed. If the slowdown in business activity was not enough to worry policymakers, prices charged by producers fell at the fastest rate for a year to spur further concern about deflation becoming ingrained,” stated Chris Williamson, chief economist at Markit.