Manufacturing production in the euro zone contracted more than initially expected for December, according to numbers out today from Markit, while manufacturing in the UK grew at the fastest rate in 15 months on the back of surprising domestic demand. These figures drawn from polling purchasing managers monthly, suggest the euro zone could be in for another year of recession amid continuing weak domestic and international demand. Only Ireland showed improved operating conditions, while downturns accelerated in Germany, Spain, Austria and Greece.
Reduced trade between euro zone countries and poor demand from the global market hit exports. Only Spain, the Netherlands and Ireland saw increases in new export orders during December, while Italy also saw some improvement. Germany, Greece, and France all reported substantial declines in new export business, which doesn’t bode well for a happy new year.