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The Eurozone manufacturing sector slowed its pace of expansion further in the month of September, the latest manufacturing activity survey from IHS/Markit research showed.

The Eurozone manufacturing purchasing managers index (PMI) dropped to 53.3 in September while services PMI edged higher to 54.7 versus 54.4 last.

The IHS Markit Eurozone PMI Composite dropped from 54.5 in August to 54.2 in September, hitting fresh 4-month lows.

Comments from  Chris Williamson, Chief Business Economist at IHS Markit:

“A near stagnation of exports contributed to one of the worst months for the Eurozone economy for almost two years. Trade wars, Brexit, waning global demand (notably in the auto industry), growing risk aversion, destocking and rising political uncertainty both within the Eurozone and further afield all fuelled the slowdown in business activity.”

“Thankfully, the slowdown was limited to manufacturing. A buoyant service sector, boosted in part by domestic demand being supported by strong job gains, means the survey data are running at a level indicative of the economy growing by a solid 0.5% in the third quarter.”

“However, with new orders and backlogs of work rising at much reduced rates compared to earlier in the year, export growth evaporating and future expectations remaining close to two-year lows, the risks to future growth appear tilted to the downside.”