Service sector companies in the eurozone are bearing the brunt of an economic slowdown according to a survey by Barlcays Capital.

The global credit squeeze, the strong euro and a weakening US economy are still taking their toll, purchasing managers' indices for the region showed. But the deceleration in industry appeared less pronounced.

In a report in the FT, service sector growth slipped this month to the slowest since June 2005, almost certainly reflecting weaknesses in financial services. Manufacturing production growth also weakened but was slightly stronger than October's low. That suggested industry was weathering the financial storms.

But indicators of likely future trends, for instance new order levels, suggested that might change, analysts argued. "It is clear that the eurozone industrial sector is not escaping the global slowdown. Rather, I would expect it to be at the epicentre. It is being pummelled by the strength of the euro and sensitive to the global business cycle," said Julian Callow at Barclays Capital.

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