Despite continued contraction, business activity in the countries signed up to the euro declined at the slowest rate for five months in January, according to the Reuters Eurozone Composite Output Index (covering both manufacturing and services) compiled by NTC Research.

The index registered 49.7, below the 50.0 no-change threshold for the fifth consecutive month, but up from December’s 47.6 and the series nadir of 45.2 recorded in October. Last month’s continued contraction reflects a decline in manufacturing, the output index for which stood at 47.9 compared with 51.0 in the service sector.

Other findings include:

* New business
New business levels fell for the tenth month in succession, but at 48.6 the decline was the slowest since July.

* Input prices
The composite index for average input costs climbed from December’s 47.2 to 51.3, signalling growth for the first time in four months. This reflected a rise in service sector prices (57.7), whereas those in manufacturing continued to decline (41.7).

* Employment
There was a slight rise in the composite index for employment, up from December’s 47.2 to 47.6. Still below the 50.0 mark, this reflected continued contraction in both services (49.7) and manufacturing (44.4).

The composite surveys claim to cover 74% of total Eurozone private sector activity.

News source: NTC Research