Markit's Eurozone Manufacturing Purchasing Managers Index (PMI) posted 53.2 points in September this year, down from August’s 54.6 points and decreasing compared to the earlier flash estimate of 53.3 points.
The euro zone manufacturing growth was the weakest since September 2016 in line with the downward trend seen since the start of the year. The slowdown in the manufacturing sector is attributed to a weakening trade cycle. Euro zone new export orders increased slightly in September and recorded the weakest rate in the current 63-month sequence of growth.
“The survey paints the worst trade picture for over five years, with export growth having slumped sharply from a series record high in late 2017 to near-stagnation in September,” stated Chris Williamson, chief economist at IHS Markit. He said that sluggish demand and increasing risk aversion among customers due to the concerns about trade wars, tariffs, political uncertainty and higher prices can be the reason of the slowdown.“Forward-looking survey indicators suggest the worst is yet to come: optimism about the year ahead is close to a three-year low, inflows of new orders and input buying are the weakest for over two years and backlogs of work are dropping for the first time in over three years,” he also added.