Shadow cast over Eurozone activity

EUROZONE BUSINESS growth has almost ground to a halt this month as a downturn in the manufacturing industry appears to be increasingly affecting the bloc’s dominant services industry, a survey showed on Friday.

Worryingly for policymakers at the European Central Bank, who have so far failed to stoke demand and inflation, forward-looking indicators suggest the bloc’s economy is on shaky ground.

New ECB President Christine Lagarde reaffirmed that the central bank would do its part by continuing to support the economy and respond to future risks while monitoring the side effects of its easy money policy.

The ECB has resumed its bondbuying programme and is purchasing 20 billion euros’ worth a month, and in September it lowered its deposit rate deeper into negative territory while keeping the door open to future reductions.

But so far those measures have not borne fruit.

IHS Markit’s flash November composite Purchasing Managers’ Index, seen as a reliable guide to economic health, slipped to 50.3 from October’s 50.6, moving to within a whisker of the 50 mark separating growth from contraction.

That was below all expectations in a Reuters poll and was only just shy of a more than sixyear low reading in September.