The private sector in the eurozone contracted in May, as activity levels fell to their lowest in three years.
In a survey by Markit, the eurozone composite purchasing managers’ index (PMI) fell to 46 in May, from 46.7 in April. A figure below 50 is an indication of contraction.
Declines in Spain and France accelerated, while output in Germany fell for the first time in six months.
The fall was attributed to a drop in new business due to weak demand. This now means that the private sector in the eurozone has now contracted for the the sixth month in a row.
According to the Markit chief economist Chris Williamson, the May figures show that the economy is contracting at the fastest pace for three years.
He said: “Companies report business activity to have been hit by heightened political and economic uncertainty, which has exacerbated already weak demand, both in the euro area and further afield.”
Markit have also expressed concerns that that eurozone market could contract by up to 0.5% in the current quarter.