4 Oct 2011

Eurozone manufacturing in freefall

8:49 am on 4 October 2011

Manufacturing in the eurozone shrank at its fastest pace in two years in September.

Markit's purchasing managers' index of activity dropped to 48.5 last month, from 49 in August. A reading below 50 indicates contraction.

The BBC reports it was the second consecutive month that eurozone manufacturing has shrunk.

"Manufacturers are reporting the worst business conditions for over two years, facing a combination of lacklustre domestic demand and falling export sales," said Markit's chief economist Chris Williamson.

Greece, the focal point of the eurozone's debt crisis, saw its output contract for the 25th consecutive month.

Even in Germany, factory activity was at a standstill.