LONDON (SHARECAST) - The Eurozone is heading for its weakest quarter since the height of the financial crisis in 2009, according to the latest figures from Markit.
Its Eurozone PMI Composite Output Index showed firms struggling to get new business in November, particularly in the services sector.
Chris Williamson, Markit's Chief Economist, said that while official measures showed GDP in the region fell by just 0.1% in the third quarter, the downturn could be gathering pace.
"The final three months of the year could see GDP fall by as much as 0.5%," he warned.
The PMI index was little-changed in November, up fractionally from 45.7 in October to 45.8.
Anything over 50 denotes an expansion in activity.
In November output fell sharply in both the manufacturing and service sectors.
While the former saw the rate of contraction ease slightly, the latter saw business activity fall at a rate not seen since July 2009.
There was a steep deterioration in new business, which fell at one of the fastest rates seen since mid-2009.
A sharper rate of decline in the services sector was partly offset by manufacturers reporting that their rate of loss of new orders had eased slightly.
Service sector firms reported their expectations for activity in the year ahead had dropped to the lowest level since March 2009.
Sentiment dropped particularly sharply in Germany, but improved slightly in France..
October’s flash reading had been the lowest since June 2009 and, for the fourth quarter of 2012 so far, market said the PMI data suggested "the strongest contraction of output since the second quarter of 2009".
Employment fell across the region for the eleventh successive month, with the rate of job losses running at the second-fastest since January 2010 as firms sought to reduce costs in the face of weak demand and an uncertain outlook.
This rate of decline steepened in services, overshadowing an improvement in manufacturing.
