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Eurozone Business Growth Drops to Six-Month Low in October as Prices Rose

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Eurozone business activity growth has slowed down in Oct. as firms faced rising costs due to supply-chain constraints, as the service sector struggled with the COVID-19 pandemic.

Source: IHS Markit

Euro Stoxx 50 up +1.05%, EUR USD up +0.14%

IHS Markit’s Flash Composite Purchasing Managers’ Index dropped to a six-month low of 54.3 in October from 56.2 in September.

Chris Williamson, a chief business economist at IHS Markit, stated that a sharp slowdown in October implies the Euro area starts the fourth quarter with the weakest growth pace since April.

Supply chain constraints caused by the COVID-19 pandemic, together with a shortage of heavy goods vehicle drivers, led to the increase in the input prices index to 73.1 from 70.9.

A PMI for the services industry dropped to 54.7 from 56.4, its lowest rate since April and below a 55.5 Reuters poll estimate.

Meanwhile, companies took on staff at the fastest pace in more than 14 years. The employment index increased to 56.0 from 54.1.

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