Germany was the only euro-area country to record solid economic growth in September, with much of the rest of the region suffering amid weakness in services.
While a global trade pickup is helping industry recover from the coronavirus pandemic, benefiting export-oriented Germany, many countries in the region’s south are more heavily reliant on tourism and hospitality. Those sectors remain badly affected by the crisis, especially with infections rising again.
Governments are warning against unnecessary travel and imposing new restrictions on restaurants and bars. For Spain and France, that means private-sector output shrank again in September, and activity in Italy practically stalled.
Read more: Euro-Area Investor Sentiment Slips for First Time in Five Months
IHS Markit’s composite Purchasing Managers’ Index for the 19-country euro area fell to 50.4 from 51.9 in August. While that’s slightly better than initial estimate, it indicates only marginal expansion.