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Euro zone manufacturing slumps

Wednesday, May 02, 2012 - 01:19

May 2 - France and Germany become the latest victims of a downturn in exports, leaving the markets concerned about growth. Joanne Nicholson reports

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Manufacturing in the euro zone has slipped into the doldrums. New orders for businesses fell for the eleventh month in a row. And output in April slumped to 46.1, more than two and half points lower than March - on the Purchasing manager's Index. The new worry is that the core members of the euro zone, France and Germany have taken a particular hit. Michael Hewson is a European economist as CMC Markets. SOUNDBITE (English) Michael Hewson, European Economist, CMC Markets, saying: "Given they make a much larger proportion of European GDP, that really is a concern, not withstanding the rising unemployment figures that we're also seeing come out of Europe at the moment." The downturn in the manufacturing sector started with the periphery countries last month. And it looks as though the markets still have a long way to slide. SOUNDBITE (English) Michael Hewson, European Economist, CMC Markets, saying: "I think a bottoming out is a long way off and the reason I think that is because of the sharp drop we've seen in Spanish and Italian PMI's over the past month." Many analysts say now, that unless export demand from countries outside the euro zone picks up, it'll be hard to see where growth for the European economies will come from in the coming months. Joanne Nicholson, Reuters

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Euro zone manufacturing slumps

Wednesday, May 02, 2012 - 01:19