Signs of weakness clouded the world economic outlook yesterday after a leading business survey indicated the contraction in eurozone manufacturing activity gathered pace this month, while industrial expansion also slowed in the US and China.
With eurozone officials concerned that the bloc has hit the political limits of austerity in the face of growing opposition in recession-hit countries, the gloomy data add to pressure on the European Central Bank to cut rates next week.
The closely watched flash – or initial – Markit purchasing managers’ index for eurozone manufacturing dipped to a four-month low of 46.5 in April, far below the 50 level that separates growth from contraction. The composite index for Germany, the bloc’s largest economy, fell sharply to 48.8, a six-month low.