As Markit Economics’ preliminary report showed, the Composite PMI for 19 countries of the euro area fell to 52.7 in February from 53.6 in January. The indicator recorded the deepest decline since January 2015.
Analysts had expected the index to go down to the level of 53.3. Readings below 50 points indicate a slowdown in the sector, levels above mark an expansion in activity.
Chief Economist at Markit Chris Williamson said the index slump was not only a sign of a low pace of economic growth in the eurozone, but also it showed that deflationary pressure intensified. All this raises chances for the ECB to expand stimulus measures.
In February, the Services PMI for the euro zone came in at 53 versus 53.6 a month earlier. This figure was a 13-month low.
According to preliminary data, the Combined PMI in Germany fell to 53.8 this month compared with 54.5 in January. But the Services PMI added 0.1 coming in at 55.1, though experts had expected a decline to 54.7. The Manufacturing PMI was at the lowest level since November 2014, reaching 50.2 against 52.3 the prior month.
The Composite and Services PMIs in France fell to 49.8 each. At the same time, the Manufacturing PMI unexpectedly jumped to 50.3 from 50 in January. Analysts had forecasted a decline of 0.1.