Eurozone growth slows as war threatens recovery

Eurozone growth slows as war threatens recovery

FRANKFURT: Business activity in the eurozone slowed in March, according to a closely watched survey, as high prices and a gloomy outlook raised fears the Ukraine war could snuff out economic recovery. Thursday’s data indicated that while Europe was still growing at a solid pace after the lows of the coronavirus pandemic, clouds loomed for the health of the economy moving forward. The survey underscores the “immediate and material impact” of the war on the economy and “highlights the risk of the eurozone falling into decline in the second quarter”, said S&P’s chief business economist, Chris Williamson.

Had it not been for the easing of coronavirus measures, “business activity would have weakened far more sharply in March”, Williamson added. The purchase managers’ index (PMI) from S&P (formerly IHS Markit), slipped 1.0 points to 54.5, a statement said. A figure above 50 indicates growth. Among eurozone countries, France best resisted the negative effects of the war, as its service industry boomed and consumer demand offset slumping exports.

Growth slowed more steeply in Germany, Europe’s biggest economy, but manufacturing was still above the levels seen late last year, when the country’s crucial export sector suffered deeply due to the pandemic. Analysts and officials warn that the