German troubles add to the eurozone's pain
The misery of the eurozone is not abating with the German powerhouse back in trouble, according to the latest snapshot of activity in the single currency area.
The PMI composite index for services and manufacturing in the euro area contracted for a 15th successive month in April, according to Markit. The reading was 46.5, unchanged on the previous month, with any figure below 50 signalling a contraction.
In Germany, eurozone's largest economy, the composite PMI fell below 50 for the first time since last November. "Calls for a more active German role in the eurozone's rebalancing process might eventually not trail away unheard," said Carsten Brzeski of ING Bank. "Maybe not for the sake of the eurozone but simply due to pure self-interest."
The eurozone's contraction is down to the Continent's unresolved debt crisis and deep budget cuts imposed by struggling member states.
The European Central Bank forecasts the euro area will contract by 0.5 per cent in 2013. Spain, Greece, Italy and Portugal are all expected to suffer even sharper falls in output.