Euro Manufacturing, Services Shrink as Crisis Deepens: Economy

Euro-area services and manufacturing output contracted at the fastest pace in almost three years in May, adding to signs the economy is suffering under the worsening sovereign-debt crisis.

A composite index based on a survey of purchasing managers in manufacturing and services dropped to 46 from 46.7 in April, London-based Markit Economics said today. While above an initial estimate of 45.9, the May reading is the lowest since June 2009. The indicator has been below 50 -- indicating contraction -- for four months. Separate reports showed euro-region retail sales and German factory orders declined in April.