Brussels, March 24 (AFP/APP):There has been “an unprecedented collapse” in business across the eurozone this month as EU countries impose severe restrictions on movement to slow the coronavirus, according to indicators released Tuesday.
The PMI survey by analysis company IHS Markit confirmed what economists and governments had been bracing for: a dramatically abrupt tumble into a certain recession. But the figures were even worse than many had expected.
The provisional data showed a slump in activity in the 19-nation eurozone in March “far exceeding that seen even at the height of the global financial crisis,” IHS Markit said in a statement. Its PMI index for this month dived to 31.4 points — the lowest since it started its survey in 1998.
A reading below 50 points indicates a contraction. In February, the index had stood at 51.6. Major economies Italy, France, Germany and Spain are all deeply affected and have implemented severe social and business restrictions to try to slow the virus’s spread, by keeping potential carriers at home.
The eurozone’s economic struggle was worsened by some EU member states closing off their borders to neighbours, limiting the flow of goods and people within the single market.
EU countries are starting to deploy massive state spending and loan guarantees to prop up businesses and employment, with the EU dropping its strict rules on budget deficits. But that mitigation effort is yet to be felt.
