Eurozone business activity slows as UK manufacturing hits 2 year high

According to a closely monitored business survey, the Eurozone economy has significantly slowed due to weaker-than-expected growth in services and more pronounced declines in manufacturing.

S&P Global’s survey of Eurozone purchasing managers indicated that business activity nearly stalled this month, as its Composite Index dropped to a five-month low of 50.1, just above the 50 threshold that separates growth from contraction.

The reading was weaker than expected by economists polled by Reuters, who had anticipated a slight increase from 50.9 last month to 51.1.

The data indicated a continued divergence between the downturn in manufacturing and growth in the larger services sector. The manufacturing index decreased from 45.8 to 45.6, while the services index dropped from 52.8 to 51.9.

UK manufacturing activity hits 2-year high

UK business activity expanded in July, signaling a return of confidence among companies, with manufacturing hitting a two-year high as order books increased.

S&P Global’s flash composite purchasing managers' index edged above analysts’ forecasts at 52.7, up from 52.3 last month, which had seen the slowest expansion since November. A reading below 50 indicates contraction.

Manufacturing saw a sharper increase in activity compared to services, rising by 0.9 percentage points to 51.8, a 24-month high, while services recorded 52.4, up from 52.1 last month.

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