According to the report from IHS Markit, the Eurozone PMI Composite Output Index fell in September to a level only slightly above the crucial 50.0 no-change mark. After accounting for seasonal factors, the index recorded 50.1, down from 51.9 (and lower than the earlier flash reading of 50.4). September’s figure was the lowest since June 2013 and signalled a broad stagnation of the private sector economy at the end of the third quarter of 2019.

Weakness remained centred on the manufacturing economy. Latest data showed that the goods producing sector experienced its sharpest fall in output for nearly seven years. In contrast, services experienced a further uplift in activity. However, the rate of growth was modest and the weakest since the start of the year.

September’s Eurozone PMI Services Business Activity Index indicated a notable slowdown in service sector growth. Posting 51.6, down from 53.5 in the previous month, the index signalled the weakest increase in activity since the start of 2019. New business volumes also rose at a slower rate during September, increasing only marginally as demand faltered, especially from foreign clients. Companies were subsequently able to keep on top of workloads, with backlogs of work falling for a second successive month. Firms continued to recruit additional staff, although the rate of growth softened to an eight-month low. Finally, confidence about the year ahead was stronger than in August, but nonetheless remained historically weak and amongst the lowest in the past five years.