It was a blunt summation: “The Eurozone economic downturn accelerated at the start of the fourth quarter,” wrote pollster S&P Global with the release of preliminary October data for its purchasing managers’ index (PMI).

Furthermore, private sector output declined at the steepest rate in more than a decade excluding the months during the pandemic, it said. 

The composite PMI, a combination of the manufacturing and services readings, dropped to its lowest level in nearly three years, the pollster wrote. Falling to 46.5 points from 47.2 in September, the gauge pushed even farther into contraction territory and away from the growth area above the 50-point mark.

Bert Colijn, a senior economist at the Dutch bank ING, noted that the decline in the headline number “indicates that weakness in the business economy is worsening. A technical recession is becoming a more realistic risk, with the upside that weaker demand is cooling price pressures.”

A day after the worrisome PMI news, a poll of managers in Germany administered by domestic thinktank ifo (Munich; www.ifo.de) showed a better-than-expected improvement in business confidence in Europe’s largest economy. The headline reading rose for the first time in five months, with the current conditions component of the index surprising observers with an unanticipated increase. 

Reponses from companies in the plastics and rubber industry largely paralleled the national average, ifo said in polling information supplied to Plasteurope.com. The headline business confidence reading improved to -11.0 points, the second straight increase. The expectations component of the main reading – a measure for the next six months – slipped a tenth to -4.5 after a sharp rise in September, and the current conditions component also improved for the second straight month with a jump of more than 10 points to -17.3.

The ifo report followed a survey of German plastics firms conducted by local initiative Wir sind Kunststoff (We are plastics) and PIE’s sister publication Kunststoff Information, the results of which showed that the industry may be facing structural change. 

Shifts in the moods of managers in Germany’s chemical industry mirrored those in the plastics and rubber sector, according to the ifo data for October, with rises in the overall index and current conditions coincinding with a tenth of a point drop in expectations.