According to the latest HCOB PMI data, the euro area manufacturing economy continued to weaken at the end of the second quarter as the contraction in output accelerated significantly to its strongest pace so far this year. New orders, purchasing activity and employment also fell at a faster pace, but the 12-month production outlook remained positive. Input costs rose for the first time since February 2023, leading to some restraint in discounting practices by euro area factories. Output costs fell only slightly and declined at the weakest pace in more than a year.