BRUSSELS - Private business across the eurozone showed a seventh monthly decline in a row in August, with analysts warning Thursday that the single currency area is at a pivotal point if it is to escape a prolonged recession.
The keenly-watched flash Purchasing Managers Index (PMI), a survey of 5,000 eurozone businesses compiled by Markit research firm, came in at 46.6, slightly above July's score but well shy of the neutral 50-mark meaning yet more contraction.
The manufacturing score improved noticeably, from 44.0 in July to 45.3 in August, but there was a weaker result for the services sector, down to 47.5 from 47.9.
While nudging off July's combined three-year low, Markit said the detail showed "widespread" decline across the eurozone, with the rate of contraction gathering pace in Germany even as it eased in France.
"Hopes that German economic strength will aid recovery in the broader currency union were dealt a blow by its rate of economic contraction accelerating, and further signs that its export engine has slammed into reverse gear," Markit senior economist Rob Dobson said.
Taking the July-August data together, Dobson said the eurozone was facing a 0.5-0.6 percent drop in eurozone gross domestic product in the third quarter this year, "so it would take a substantial bounce in September to change this outlook."
Germany's composite PMI fell to a 38-month low of 47.0 from 47.5 in July.
The composite PMI for France came in at 48.9, up from 47.9 in July.
The August PMI "did nothing to challenge the notion that the single currency area is now firmly in recession," said Jonathan Loynes of London-based Capital Economics.
"The eurozone remains in recession, but the contraction in the manufacturing sector eased in August, driven by marked improvements in France and Germany," said Christian Schulz of Germany's Berenberg Bank, referring to some signs of increasing confidence especially in France.