Index shows Europe’s growth receding

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Reflecting disappointing economic news from all over Europe, the Purchasing Mangers Index (PMI) shows that within the Eurozone manufacturing has declined to the point of stagnation. The PMI, which shows actual changes rather than expectations of change, is lower than it has been in four months in the Eurozone overall. The largest declines have been reported from France, Germany, and Spain. These declines echo economic trends in Europe as a whole. These reports make it likely that the 2 percent interest rate set by the European Central Bank will remain at that level, where they have been for almost two years. Although another indicator of economic well-being, Gross Domestic Product (GDP) figures, are expected to show an improvement over the end of 2004, further declines are expected in the second quarter of this year.