The final data published by HCOB showed that activity in the eurozone private sector declined markedly in June, driven by a deterioration in demand as new orders declined for the first time since February. However, the data highlighted a cooling of price pressures across the euro area.
The Eurozone Composite PMI Output Index, which assesses the change in activity in the manufacturing sector and the service sector, fell in June to 50.9 points from 52.2 points in May. Economists had expected a decline to 50.8 points. Meanwhile, services PMI reached 52.8 (3-month low) compared to 53.2 in May and forecasts at 52.6.
The data also showed that almost all of the eurozone nations with composite PMI data available recorded growth during June, although softer expansions were seen in all cases. Meanwhile, new orders in the eurozone private sector fell for the first time since February. New export orders also declined in June. In fact, the decrease in new export business outstripped that seen for total new orders, implying a stronger drag on demand from external sources rather than domestic. Outstanding business volumes fell for a fifth consecutive month, with the rate of decline being the strongest since February. Private sector employment rose again in June, but at a slower pace than in May. Expectations for business activity in the coming year remained positive during June, but dropped to a 4-month low. As for the inflationary situation, the rate of input price inflation fell to a five-month low, while output charges rose at the weakest pace since last October.