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September 04, 2012 at 05:35 AM
The manufacturing sector in the eurozone shrank more quickly than thought in August, even though factories had cut prices in an attempt to boost demand. But slowing economies in the region, weighed down particularly by Spain and Italy, took their toll even on France and Germany.
Reuters reported Monday that an earlier flash reading from Markit Economics of the manufacturing sector PMI stood at 45.3; however, the final results released Monday revealed that the sector instead hit 45.1. That’s above a three-year low hit in July of 44.0, but it’s still the thirteenth month in a row that the index has lingered below 50, the dividing line between economic expansion and contraction.
Friday figures had shown that inflation grew more than expected as well, despite price cuts by factories. Still, the inflation numbers may affect the ECB’s actions later in the week regarding interest rates.
