By Maria Martinez

Eurozone economic growth slowed for a second consecutive month in September, marking a further retreat from the 15-year peak recorded in July, as supply-chain shortages impeded both manufacturing and service sector output, IHS Markit said.

The eurozone composite purchasing managers index fell to 56.2 in September from 59.0 in August. Although indicative of a strong expansion in business activity, it marked a considerable slowdown from the expansions seen between June and August, which were among the fastest in 23 years of data collection, IHS Markit said.

"The current economic situation in the eurozone is an unwelcome mix of rising price pressures but slower growth," IHS Markit's Chief Business Economist Chris Williamson said. Both are linked to supply shortages, especially in manufacturing, which has seen a steeper fall in output growth than services, he added.

Inflationary trends moved higher in September, with input prices rising at the fastest rate on record, IHS Markit said.

"With supply shortages likely to continue to subdue manufacturing well into 2022, the economy has therefore become increasingly dependent on the service sector to sustain a solid recovery path," Mr. Williamson said. However, the service sector is also reporting a marked cooling of demand growth.

The services PMI fell to 56.4 in September from 59.0 in August. According to Mr. Williamson the decline is due not only to shortages, but also to customers being deterred by concerns over the persistence of the pandemic and by higher prices, as well as some moderation of spending after the initial reopening of the economy.

Write to Maria Martinez at maria.martinez@wsj.com

(END) Dow Jones Newswires

10-05-21 0432ET