MADRID, 23 Nov. (EUROPA PRESS) -
The activity of the private sector of the euro zone continued its deterioration in the month of November, although at a somewhat more moderate pace than in previous months, according to the preliminary data of the PMI index, which keeps the economy of The region and companies destroyed jobs for the first time since the beginning of 2021.
Specifically, the advance data of the composite PMI for the euro zone has stood at 47.1 points from 46.5 the previous month, its best reading in two months, but it represents the sixth consecutive contraction in activity.
In the case of the services sector, the PMI index stood at 48.2 points in November from 47.8 in October, its fourth month in contraction, while the manufacturing activity data has improved to 43.8 points, compared to to 43.1 the previous month, its best reading in six months.
"The euro zone economy is stuck in the mud," summarized Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, for whom the analysis of the preliminary November reading of the PMI "indicates the potential for a second consecutive quarter of GDP contraction, which would be equivalent to the commonly accepted criterion for a technical recession.
In this sense, the expert warns that "this is not what the ECB wants to see", since, despite the weakness of the economy, service companies continue to raise prices due to the increase in the cost of inputs, something which could be attributed mainly to salary increases.
Likewise, the economic weakness, which initially affected the employment of industrial workers, is expected to spread to the service sector labor market, where job growth has already stalled.
As such, excess capacity resulting from declining demand and relatively weak confidence in future prospects caused companies, as a whole, to cut their employment levels for the first time since the start of 2021.
"Anticipating a continued downward trend for the coming months, there is the possibility of an increase in the unemployment rate, which until now has shown resilience," warns De la Rubia.
