Eurozone PMI Surveys Reveal Deepening Recession and Weak Economic Activity

The euro zone is likely in recession as the downturn in business activity deepened in December, according to PMI surveys. Both Germany and France experienced a decline in activity across services and manufacturing. This would mark two consecutive quarters of economic contraction, meeting the technical definition of a recession. The European Central Bank has trimmed its growth forecasts for 2023 and 2024. Meanwhile, Britain's services sector saw a pick-up in growth, suggesting it may avoid a recession for now. Firms in the euro zone reduced staffing and demand for services fell as consumers faced high borrowing costs.