Economists continue to provide frightening forecasts about the future of the European economy. Predictions about an extremely cold winter and a lack of energy recourses were replaced by stories about an inevitable recession. Since no one believes that Europe may slip into a deep recession, now, economists foresee just a slight economic downturn.
Sometimes analysts have to search for confirmation of their gloomy forecasts. In the century of high technology, people can get access to almost any piece of information. That is why without facts that may confirm this or that prediction, there is no use to frighten people. For example, last month, the eurozone manufacturing PMI slumped. Such a decline could hardly be explained by some seasonal reasons.
The indicator has been falling for the fifth month in a row, which points to the approaching recession. According to a report from S&P Global, in November, the manufacturing PMI totaled 47.8 points, being below the 50-point threshold for five consecutive months. A month earlier, the indicator dropped to its 23-month low of 47.3 points. Analysts suppose that such a performance proves the fact that the expected recession is likely to be mild.
“A fifth consecutive monthly falling output signaled by the PMI adds to the likelihood that the eurozone is sliding into recession. However, at present, the downturn remains only modest, with an easing in the overall rate of contraction in November means so far the region looks set to see GDP contract by a mere 0.2%,” Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, said.
