Eurozone's manufacturing activity improves slightly in May

The pace of decline in the eurozone's manufacturing sector eased in May due to improve order volumes. The Markit compiled Purchasing Managers' Index (PMI), an important parameter to judge the manufacturing sector of euro zone, increased to 48.3 in May compared to 46.7 in April. This is the highest PMI reading in last 15 months. A reading below 50 indicates contraction in the sector. With contraction in May, the sector has now contracted for 22 months in a row.

In Germany, Europe's largest economy, the PMI figure increased to 49.4 which is just below 50. This is the highest level PMI reading in last three months. Other euro zone countries have also witnessed increase in PMI reading compared to previous month. The PMI reading shows that Euro zone manufacturing sector is improving but very slowly. Euro zone economy is expected to contract for the current year.