May composite PMI data signals a weak second quarter for the Euro area economy amid declining manufacturing and services sentiment.
The Euro area composite Purchasing Managers’ Index dropped further into contraction territory in May, indicating a struggling economy heading into the second quarter. Both manufacturing and services sectors experienced deteriorating sentiment, with services particularly affected.
The decline follows already weak economic performance in prior months, suggesting persistent challenges. Analysts had anticipated modest improvement, but the data fell short of expectations, reinforcing concerns about growth prospects.
The weak PMI readings add pressure on the European Central Bank as it weighs monetary policy decisions amid slowing economic activity and inflation concerns.