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Eurozone Economic Downturn Eases In June

The euro area private sector contracted at a slower pace in June as lockdowns to prevent the spread of the coronavirus disease outbreak were further relaxed, flash survey results published by IHS Markit showed Tuesday.

The flash composite output index advanced more-than-expected to 47.5 from 31.9 in May. The score was forecast to rise to 42.4.

The latest gain took the PMI to its highest since February, though still indicated an overall decline in business output.

Output decreased again in both manufacturing and services, the latter showing the slightly steeper rate of decline.

The services Purchasing Managers' Index climbed to 47.3 from 30.5 in the previous month. This was also above economists' forecast of 41.0.

The factory PMI rose to 46.9 in June from 39.4 in May. The expected level was 44.5.

While second quarter GDP is still likely to have dropped at an unprecedented rate, the rise in the PMI adds to expectations that the lifting of lockdown restrictions will help bring the downturn to an end as we head into the summer, Chris Williamson, chief business economist at IHS Markit said.

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