By Alex Brittain
LONDON--Activity in euro-zone factories shrank in March at its fastest rate in three months and new orders also declined at a faster pace, suggesting the industry will continue to struggle in months ahead.
The figures add weight to evidence the region's economy shrank in the first three months of the year, lengthening a downturn that has already lasted 15 months and casting doubt on euro-zone leaders' hopes that a recovery will begin soon.
The euro-zone purchasing managers' index for the manufacturing sector fell to 46.8 in March, its lowest level since December, from 47.9 in February, data provider Markit said Tuesday.
A reading below 50 means activity was shrinking month-to-month. Markit had previously estimated a slightly more negative figure for March of 46.6.
"The euro-zone manufacturing sector looks likely to have acted as a drag on the economy in the first quarter, with an acceleration in the rate of decline in March raising the risk that the downturn may also intensify in the second quarter," said Chris Williamson, chief economist at Markit.
The worsening state of euro-zone factory activity at the end of the first quarter is bad news for the bloc's leaders, who are banking on an upturn in the economy later this year to help ease their fiscal crisis and prevent other countries from needing bailouts, following aid and loans for Greece, Portugal, Ireland, Spain and Cyprus.
All eight euro-zone countries that Markit provides detailed figures for showed activity contracting in March, as factories in both Germany and Ireland lost momentum, having grown in previous months. Falls in output accelerated in Austria, the Netherlands, Italy, Spain, France and Greece.
A gauge of new orders taken by companies across the bloc--which helps indicate how activity will progress in coming months--fell at its sharpest rate since December.
Write to Alex Brittain at alex.brittain@dowjones.com
LONDON--Activity in euro-zone factories shrank in March at its fastest rate in three months and new orders also declined at a faster pace, suggesting the industry will continue to struggle in months ahead.
The figures add weight to evidence the region's economy shrank in the first three months of the year, lengthening a downturn that has already lasted 15 months and casting doubt on euro-zone leaders' hopes that a recovery will begin soon.
The euro-zone purchasing managers' index for the manufacturing sector fell to 46.8 in March, its lowest level since December, from 47.9 in February, data provider Markit said Tuesday.
A reading below 50 means activity was shrinking month-to-month. Markit had previously estimated a slightly more negative figure for March of 46.6.
"The euro-zone manufacturing sector looks likely to have acted as a drag on the economy in the first quarter, with an acceleration in the rate of decline in March raising the risk that the downturn may also intensify in the second quarter," said Chris Williamson, chief economist at Markit.
The worsening state of euro-zone factory activity at the end of the first quarter is bad news for the bloc's leaders, who are banking on an upturn in the economy later this year to help ease their fiscal crisis and prevent other countries from needing bailouts, following aid and loans for Greece, Portugal, Ireland, Spain and Cyprus.
All eight euro-zone countries that Markit provides detailed figures for showed activity contracting in March, as factories in both Germany and Ireland lost momentum, having grown in previous months. Falls in output accelerated in Austria, the Netherlands, Italy, Spain, France and Greece.
A gauge of new orders taken by companies across the bloc--which helps indicate how activity will progress in coming months--fell at its sharpest rate since December.
Write to Alex Brittain at alex.brittain@dowjones.com
