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Oct. 23, 2020, 4:51 a.m. EDT

Flash eurozone PMI slips to four-month low in October

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By Steve Goldstein

A key indicator for the eurozone economy fell to a four-month low in October, as increased restrictions due to a rise in coronavirus numbers hit the services sector.

The flash eurozone composite purchasing managers index fell to 49.4 in October from 50.4 in September, falling just below the 50 mark that indicates deteriorating conditions.

Economists had expected a 49.5 reading.

The flash eurozone services PMI fell to 46.2 from 48, while the manufacturing PMI rose to 54.4 from 53.7.

“The survey revealed a tale of two economies, with manufacturers enjoying the fastest growth since early-2018 as orders surged higher amid rising global demand, but intensifying COVID-19 restrictions took an increasing toll on the services sector, led by weakening demand in the hard-hit hospitality industry,” said Chris Williamson, chief business economist at IHS Markit.

He also noted a divergence in performance between Germany and the rest of the eurozone.

French economy minister Bruno Le Maire said in a Friday radio interview that France’s gross domestic product would contract in the fourth quarter.

The flash U.K. composite PMI also fell to a four-month low, falling to 52.9 from 56.5.

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