Business activity in the EU in August showed the strongest decline since 2020
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Business activity index (PMI) in the EU in August amounted to 47 points against 48.6 points in July. Such data today, August 23, published consulting company S&P Global, which calculates this index. A PMI below 50 reflects a slowdown in activity. This is the lowest PMI since November 2020. S&P estimates that the data for July and August together represent a 0.2% decline in GDP for the quarter.
PMI in the industry in the EU in August rose from 42.7 to 43.7 points. This nevertheless means a reduction in activity, albeit at a slower pace. At the same time, PMI in the services sector fell from 50.9 to 48.3 points, that is, it moved from growth to decline. The authors of the S&P report also point out that inflationary pressures remain, albeit at a lower level than the average over the past two and a half years. “Inflationary pressures on the service sector remain strong, as well as worrisome and pressure in terms of wage costs,” said Bert Colaine, an ING bank analyst.
The German PMI fell especially hard, from 48.5 in July to 44.7 in August. The decline in business activity in Germany in August was the most significant since May 2020.
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