Investing.com - Manufacturing activity in the euro zone expanded at a slower rate than expected in February, underlining concerns over the health of the region’s economy, preliminary data showed on Thursday.
In a report, market research group Markit said that its preliminary manufacturing purchasing managers’ index inched down to a seasonally adjusted 53.0 this month from a final reading of 54.0 in January. Analysts had expected the index to hold steady at 54.0 this month.
Meanwhile, the preliminary services purchasing managers’ index increased to a seasonally adjusted 51.7 in February from a reading of 51.6 in January. Analysts had expected the index to ease up to 51.9 this month.
On the index, a reading above 50.0 indicates industry expansion, below indicates contraction.
Commenting on the report, Chris Williamson, Chief Economist at Markit said that “A dip in the euro zone PMI provides a reminder that the region’s recovery continues to be uneven and fragile.”
He added, “Looking at the latest two months as a whole, the PMI suggests the region is on course to see GDP expand by up to 0.5% in the first quarter, which would be the strongest growth for three years.“
Following the release of the data, the euro added to losses against the U.S. dollar, with EUR/USD shedding 0.27% to trade at 1.3696, compared to 1.3700 ahead of the data.
Meanwhile, European stock markets were lower after the open. The EURO STOXX 50 fell 1%, France’s CAC 40 declined 0.8%, London’s FTSE 100 slumped 0.6%, while Germany''s DAX dropped 1.3%.