Summary

• The Eurozone PMI, compiled by S&P Global, has moved deeper into contraction territory in May, according to the early ‘flash’ estimate.
• Combined with the growing signs of the region slipping into an economic downturn, the coming inflation spike creates a deepening dilemma for policymakers.
• The region’s supply shock from the war is meanwhile intensifying, as indicated by increasingly widespread supply chain delays.
• Supply shortages threaten not only to constrain growth in the coming months but also have the potential to add further upward pressure to inflation.

May’s flash PMI survey data show the eurozone economy taking an increasingly severe toll from the war in the Middle East. Output has now contracted for two successive months, job losses have become more

3.78K Followers