Forex News – Euro zone manufacturing activity contracts in November

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Euro zone manufacturing activity contracted in November based on a Markit report released today.

The region’s purchasing managers index (PMI) gave a reading of 46.4 in November which was unchanged from October and in line with expectations based on a survey compiled by Reuters.

Europe’s powerhouse, Germany, reported a manufacturing PMI of 47.9 which was also as forecast and the same as the previous month.

Meanwhile Italy’s manufacturing activity picked up marginally to 44.0 from 43.3. The index was expected to drop to 43.0.

Manufacturing PMIs were below the key 50 level in all nations covered by the survey. A reading of less than 50 indicates a contraction in activity and above indicates expansion.

“Both production and new orders fell at rates not seen since the height of the credit crunch in [the first half of] 2009. It was also the first month since mid-2009 that all countries saw output fall, highlighting the broadening-out of the downturn from the periphery to the core,” said Chris Williamson, Markit chief economist.

“Manufacturers are now reducing headcounts again, in line with lower sales and the darker economic outlook,” he added.