Global Manufacturing Slows

Euro-area output shrinks and a Chinese indicator points to a contraction.

Euro-area manufacturing output shrank at the fastest pace in three years in June and a Chinese output gauge indicated contraction as Europe’s worsening fiscal crisis clouded global economic-growth prospects.

A gauge of euro-region manufacturing fell to 44.8 from 45.1 in May, London-based Markit Economics said today in an initial estimate. That’s the lowest in 36 months. The preliminary reading was 48.1 for a Chinese purchasing managers’ index from HSBC Holdings Plc and Markit. A reading below 50 indicates contraction.

‘Heightened Problems’

In Greece, Samaras is set to announce the members of his government today after securing agreement from the country’s political leaders on a coalition that will seek relief from austerity measures tied to international loans.

‘Darker Outlook’

Euro-region gross domestic product probably dropped 0.6 percent in the second quarter, according to Chris Williamson, chief economist at Markit. In the year’s first three months, the area’s economy stalled.

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