November 21, 2008

Producer managers index falls in eurozone

The purchasing managers index in the 15-country eurozone dropped to the lowest point since 1998, when the figure was first tracked, researchers said.

The composite index tracking services and manufacturing fell from 43.6 in October to 39.8 in November, indicating a shocking deterioration in the eurozone economy, said Chris Williamson, chief economist at Markit, which conducts the monthly survey, the Financial Times reported Friday.

The economy of the eurozone shrank 0.2 percent in the second and third quarter, the Times reported. In November, manufacturing provided the bigger draw on the composite index, which defines contraction as any figure less than 50 and growth as any figure more than 50.

Employers are reacting quickly to the downturn, shedding staff at a pace not seen for over five years, said Williamson.

Amid the general gloom of economic news, however, Weder di Mauro, a member of the German council of economic experts, at the European Banking Congress, was nonplussed.

Flooded with negative economic news, a drop in the purchasing managers index, has zero effect these days, she said.