Wainwright Marks Management - Euro zone Manufacturing Productivity Cools

Wainwright Marks Management analysts say that, according to a recent survey, euro zone manufacturing productivity cooled to near its lowest point in two years last month as sentiment dipped due to escalating fears of a global trade war.

Wainwright Marks Management analysts stated that the survey only represents two thirds of the usual number of manufacturing businesses that are surveyed as large numbers of euro zone factories close during the summer months.

IHS Markit's August manufacturing Purchasing Managers' Index fell to its lowest point in almost 2 years last month but Wainwright Marks Management analysts say the reading remained above the 50 mark that separates growth from contraction.

Wainwright Marks Management analysts said that euro zone production gained steadily last month but new orders reached a 24 month low amidst growing concerns over future prospects.

In August employment, new orders and optimism declined and Wainwright Marks Management analysts say this indicates that there is little chance of an increase in activity in September.

The index which measure optimism in the euro zone dropped from 62.4 in July to 61.0 in August, the lowest reading in almost 3 years.

Wainwright Marks Management say European manufactures are very concerned about the risk of a full blown global trade war erupting as US President Donald Trump has threatened to impose tariffs on an additional $200 million worth of goods imported from China.

In an effort to try and increase demand, European factories raised prices at the weakest rate in 12 months. Wainwright Marks Management analysts say inflation decreased to 2.0 percent in August and that this could indicate that the recent increase in inflation is not permanent.