Euro zone business activity shrinks once more as Covid second wave surges

A worker at a Paris bar sweeps up after closing early to comply with new Covid-19 restrictions.

Kiran Ridley | Getty Images News | Getty Images

LONDON — Economic activity in the euro zone shrunk in October as coronavirus restrictions returned to the region, preliminary data showed on Friday.

The flash euro zone PMI composite output index, which looks at activity in both manufacturing and services sectors, dropped to a four-month low in October to 49.4, versus 50.4 in September. A reading below 50 represents a contraction in activity.

The latest numbers coincided with a period of new restrictions across the euro zone as it grapples with a second wave of coronavirus infections.

France introduced new curfews last week and decided to expand them to more regions on Thursday, meaning that restaurants and bars in cities such as Paris, Marseille and Lyon have to close at 9 p.m. local time. On Thursday, French authorities reported the highest ever number of new daily infections.

France’s composite output index came in at 47.3 in October, a five-month low, in comparison with 48.5 in September.

The Netherlands returned to a partial lockdown last week as infections spiked in the country. The new restrictions include: No more than three home visitors per day; restaurants and bars must close, although take away is still possible. Meanwhile, Ireland announced a four-week ban on household visits and Germany is advising people against traveling to ski resorts.

This is a breaking new story and it is being updated.

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