Recent surveys denote that the eurozone economy is dwindling after doing well from January to April. Economic experts blame it on the weak export resources and staggering production sector of these European countries.
Data show that the Purchasing Managers Index (PMI) decreased in April. The PMI measures the dominant trend of the manufacturing economy and is derived from a monthly examination of supply chain managers from over 5,000 businesses.
As reported by Market Watch, decreased export orders are believed to be the cause of this economic slowdown.
Since last year, this sector has seen a steady decline and threatens to persist in the coming months.
Political issues also confront the economy. Anxiety hovers amidst the undetermined schedule of UK’s exit from the European Union. In addition, the heightened trade friction between the U.S and China is seen to likely cause stagnation in economic development. There are also indictaions that confidence has diminished among eurozone businesses which can further lead to economic downfall in the days to come.
If the economy doesn’t improve for eurozone in the second quarter, then such will also be the case for the US, who also saw a strong start at the onset of 2019. Signs indicate the same end result for China.
Germany, who have always been confronted with a burdensome external environment, has been suffering from a staggering manufacturing sector since the first quarter. No significant boost is seen for Germany’s economy in the near future. On the contrary, France is seen to catch up as its service sector gains strength.
The increase in employment rate and small increases in wage have aided the eurozone economic development to make up for the reduced export sales. However, the PMI has recently shown a dip in manufacturing employment, which is a first in almost five years.