ATHENS: Greek manufacturing activity shrank in April for the eighth month in a row as weak demand at home and abroad led to a drop in new orders while employment in the sector declined, a survey showed on Monday.
Markit's purchasing managers' index for manufacturing - a sector that makes up about 10 percent of the economy - fell to 46.5 last month from 48.9 in March, its lowest reading since June 2013.
A reading below 50 denotes contraction. "The ongoing downturn in Greece's manufacturing sector reached a new low in April, with the PMI survey showing factory production falling to the greatest extent for nearly two years," said Markit economist Phil Smith.
With Greece yet to conclude negotiations with its euro zone partners and the IMF on reforms needed to unlock remaining bailout aid, the uncertainty has re-ignited fears of a "Grexit".
"Underpinning the downturn was weak demand amid uncertainty towards the political and economic outlook of the country," Smith said. Factory output shrank at its fastest pace in 22 months in April, with sharp declines in the production of intermediate and capital goods. Consumer goods saw a small uptick.
Incoming new orders extended their decline to eight months, and the pace of contraction accelerating sharply.
The weakness reflected a further loss of business from abroad, with companies saying that uncertainty had stymied client interest.
Employment in the sector, which had risen modestly in the previous four months, returned to contraction. While production lines slowed, strong competition led companies to cut prices in a bid to support sales.
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