EU PMI Falls in December After Bad Quarter

The eurozone economy saw anaemic growth in December and suffered its worst quarter for more than a year, a survey has indicated.

The closely watched Markit/CIPS composite purchasing managers’ index (PMI) for December fell to 51.4 from an earlier estimate of 51.7.

But that was better than the previous month’s reading of 51.1, which had marked a 16-month low.

The eurozone economy has seen 18 months of continuous, albeit weak growth.

Markit said its latest PMI survey, which combines the results of individual surveys of the construction, services and manufacturing industries, suggested the eurozone economy grew by just 0.1% in the last three months of 2014.

Persistently low inflation since the start of last year has led consumers and business to hold off making purchases or making investments in the expectation that prices will continue to fall.

The problem has been exacerbated since the summer by the falling price of oil. Brent crude has fallen by more than 50% since August to $51.54 per barrel.

The fear of deflation led the European Central Bank (ECB) to lower interest rates to 0.05% and begin an asset purchase programme to inject cash into the economy in August.

However, the ECB has resisted taking the same action as central banks in the US, UK and Japan by buying government debt.

via BBC

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.