The downturn in the euro zone manufacturing sector deepened as business conditions deteriorated in all euro nations in March this year. Markit's Eurozone Manufacturing Purchasing Managers Index (PMI) was at 46.8 points in March, down from 47.9 in February but above the earlier flash estimate of 46.6. The Markit Final Eurozone Manufacturing PMI was below the neutral 50 points signalling a deterioration in business conditions since August 2011.
March nonetheless saw a worsening of manufacturing conditions across the currency union. Germany and Ireland both fell back into contraction, while downturns remained marked in all of the other nations covered by the survey, with France and Greece continuing to see significant rates of contraction.
Manufacturing output in the euro area contracted at the fastest pace year-to-date, as companies experienced a further solid decrease in inflows of new business. Total new orders of euro zone manufacturers contracted at the fastest pace since December last year, as demand was weaker in both domestic and export markets.
Chris Williamson, chief economist at Markit, said, "Companies reported that signs of stronger demand from markets such as Asia and the US were countered by a renewed weakening of demand within the euro area, in turn reflecting deteriorating business and consumer confidence."