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Activity in the eurozone manufacturing sector continued to decline in June

Final data released by S&P Global showed that activity in the eurozone manufacturing sector declined again in June, recording the fifth consecutive monthly decline and reaching the lowest level since August 2020. Meanwhile, business confidence among manufacturing companies has fallen to a 25-month low.

According to the report, manufacturing PMI decreased to 52.1 points compared to 54.6 points in May. Economists had expected the index to decline to 52.0 points. Overall, the decline in manufacturing activity was observed in all eurozone countries surveyed by S&P Global.

The data also showed that the manufacturing output component showed the first drop since the first half of 2020, the reasons for which were a decline in demand, the war in Ukraine and constant supply problems. New orders also declined in June, with the rate of decline being the highest since May 2020. Meanwhile, new export orders recorded the fourth consecutive monthly decline. There was also growing evidence of businesses looking to control costs as purchasing activity rose at the slowest rate across the current 22-month sequence of growth. However, the delivery time component rose to an 18-month high, indicating the fewest cases of delivery delays since December 2020. Meanwhile, the number of outstanding orders declined in June, while employment growth slowed to a 3-month low.

S&P Global also reported that business sentiment in the manufacturing sector fell to its lowest level since May 2020, as concerns related to the global economic outlook and inflation put pressure on growth expectations.

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