The service sector is the latest to show signs of weakness in the euro zone. A survey of purchasing managers shows growth eased in July to its weakest rate in nearly two years.
Earlier figures showed the service sector in Germany, Europe’s largest economy, grew at its slowest pace since January last year while in France growth fell to a 16-month low. In Spain and Italy the service sector contracted.
The euro zone composite PMI, which combines the services and the manufacturing data published on Monday, fell to its lowest level since September 2009.
The index is often used as a guide to growth, and Markit, which carries out the surveys, said the numbers were consistent with stagnation in the current quarter.
“The growth slowdown in the euro zone service sector continued apace in July,” said Rob Dobson, senior economist at Markit.
“The base of the slowdown is worrisome, with signs of fragility exhibited in all of the nations surveyed. The big two of Germany and France have lost substantial growth momentum since the start of the year, conditions remain muted in Ireland, while Spain and Italy are both in contraction territory.”
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