Euro zone October PMI at near 3-year low, stirring recession worries
© Reuters. FILE PHOTO: A shopping trolley is seen as customers shop at a Carrefour supermarket in Montesson near Paris, France, September 13, 2023. REUTERS/Sarah Meyssonnier/File PhotoLONDON -Euro zone business activity took a surprise turn for the worse this month as demand fell in a broad-based downturn across the region, a survey showed, entering the fourth quarter on the wrong foot and suggesting the bloc may slip into recession.
"The flash PMIs mark a poor start to October for the euro zone, especially after showing some early signs of recovery in September," said Rory Fennessy at Oxford Economics.Suggesting a recession is well underway in Germany, Europe's largest economy, business activity contracted there for a fourth straight month as the downturn in manufacturing was matched by a renewed decline in services, its PMI showed.
In Britain, outside the European Union, businesses reported another decline in activity this month, underlining the risk of recession ahead of the Bank of England's interest rate decision next week.Geopolitical tensions heightened by the Middle East conflict pose the biggest threat to the world economy right now but other risks are also at play, World Bank President Ajay Banga said on Tuesday.
Euro zone banks further curbed access to credit last quarter even as demand fell more than expected amid high borrowing costs and a deteriorating economic outlook, an ECB survey showed on Tuesday Demand for services has fallen again this month and at a sharper rate than in September. The new business index dropped to 45.5 from 46.4, its lowest since the start of 2021.
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