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Euro area private sector growth slows further in May

Euro area private sector growth slows further in May

Business activity in the euro area private sector slowed further in May, dragged down by trade war concerns, IHS Markit data released on Thursday showed.

The flash composite purchasing managers index (PMI) dropped to 51.6 in May, compared to a previous reading of 51.5.  

The drag came from the manufacturing sector, as it widened contraction to 47.7, the lowest level in six years from 47.9 in April, while the services PMI retreated to 52.5 from 52.8.  

Output slipped for a fourth consecutive month, while new orders dropped for the 8th month straight month.  

“The eurozone will only grow by a sickly 0.2% in the current quarter, compared with 0.4% in Q1,” warned Chris Williamson, chief business economist at IHS Markit.

As of 09:7 GMT, the euro continued to trade lower versus the U.S. dollar at 1.1136, the lowest level in four weeks, as it extended its drop for a third straight session.

Later in the day, investors will focus on the European Parliamentary elections and ECB minutes for the latest monetary policy meeting.

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