According to the report from IHS Markit, the Eurozone economy came close to stalling at the end of the third quarter as demand for goods and services fell at the fastest rate in over six years. A deepening manufacturing recession, where output fell at the sharpest pace since 2012, was accompanied by a slower service sector expansion. Jobs growth and price pressures meanwhile waned and sentiment about the outlook remained among the lowest for seven years.

The Eurozone Composite PMI fell to 50.4 in September, down from 51.9 in August to signal the weakest expansion of output across manufacturing and services since June 2013. The slowdown was driven by new orders for goods and services falling for the first time since January, dropping at the sharpest rate since June 2013. Backlogs of work fell for the ninth time in the past ten months as, facing a dearth of new orders, companies occupied their workforces by working through previously placed orders. The resulting drop in backlogs of orders was the largest since November 2014 and points to the increasing development of spare capacity. The deteriorating current business situation was matched by ongoing gloom about the outlook. Expectations for the year ahead remained stuck at one of the lowest levels since 2012, lifting only marginally higher since August.