Research firm Markit reported that eurozone PMI reached a three-year low in May, which puts it back to levels of the last recession. If there was any more proof needed that the region is in a period of GDP contraction, this is it. Commenting on the broad measure of the Composite Index, Markit wrote:
At 46.0 in May, down from 46.7 in April, the Markit Eurozone PMI Composite Output Index signalled the steepest rate of decline in manufacturing and services output in the single currency area since June 2009.
May services PMI data indicates that the sector has fallen into a steepening downturn, in tandem with the stronger decline in the goods-producing sector signalled by Markit’s manufacturing data last week. There were also further signs of weakness spreading from the non-core to core nations, with even Germany slipping back into contraction.
Germany’s figure of 49.3 was a 34-month low. France’s 44.6 was a 37-month low. Spain’s PMI collapsed to 41.2. There is no reason, based on data about GDP and unemployment in the region, to think any of these numbers will improve soon.