Surveys released earlier today (Monday) showed factories in Spain are deteriorating at the fastest pace in more than two years.
The Spanish economy is sagging under the weight of harsh austerity measures, introduced by Prime Minister José Luis Zapatero. Many other Euro zone countries have also introduced various levels of austerity measures.
Meanwhile, France saw manufacturing decline for the second month in a row. Even Germany, with the biggest and arguably the most prosperous economy in the Euro zone, saw manufacturing growth effectively come to a standstill.
Chris Williamson, chief economist at PMI compiler Markit said “Manufacturers are reporting the worst business conditions for over two years, facing a combination of lacklustre domestic demand and falling export sales,”.
Euro zone unemployment remained at 10 percent for August. This figure is not representative of the individual countries and does not reflect the disparities between fairly restrained joblessness in Germany and France, and the far larger proportion of unemployment in Spain and Greece.