Eurozone business growth eased again in September, adding to signs that momentum in the currency bloc is well past its peak with country data for Germany and France also highlighting a slowdown, a survey showed on Friday.

While the regional slowdown was slightly sharper than expected, growth remained robust and firms were able to increase their prices, purchasing managers said, offering some comfort to policymakers at the European Central Bank.

But the surveys highlighted a divergence between services and manufacturing.

The bloc’s dominant service industry beat forecasts for no change in the pace of growth from last month. IHS Markit’s Eurozone Services Flash Purchasing Managers’ Index (PMI) rose to 54.7 from 54.4. Anything above 50 indicates growth.

Manufacturers, however, failed to live up to expectations.

The factory PMI slumped to a two-year low of 53.3 from 54.6, significantly below all forecasts in a Reuters poll which had a median prediction of 54.4.

An index measuring output, which feeds into a composite PMI, sank to 52.8 from 54.7. It hasn’t been lower since May 2016.

Suggesting little pickup heading into the fourth quarter, factory new order growth also slowed sharply with the index falling to a 25-month low of 51.4 from 53.0. Exports, which include trade within the bloc, were flat.

In the US, the seasonally adjusted IHS Markit Composite Purchasing Managers’ Index fell to 53.4 in September — a 17- month low.

Average prices charged by private sector firms jumped at the fastest pace since the composite survey started almost nine- years ago. Service providers, in particular, raised prices this month citing “intense cost pressures” as the reason to pass through higher labour costs and increased prices for inputs sourced from abroad.

Future expectations in both the manufacturing and service sectors fell to the lowest level this year, and the second- lowest in over two years, as optimism deteriorated.

However, while the overall index suggests that the pace of economic growth slowed to its lowest point in almost one-and-a- half years, the report did show some positive signals. Hiring grew, “indicative of non-farm payroll growth topping 200,000 in September,” Chris Williamson, economist at IHS Markit said. Further, Williamson noted, “new orders growth accelerating and backlogs of work rising due to weather-related disruptions, the survey data suggest underlying demand remains robust and that there’s an accumulation of work that will roll over into stronger economic growth in coming months.”

The rise in employment, led by service providers, was the strongest since May 2015, according to the report.

“Eurozone industry continues to struggle with the global trade uncertainties coming from an imminent Brexit and the escalating global trade conflict,” said Bert Colijn at ING.

US President Donald Trump on Monday imposed a 10 per cent tariff on about $200 billion worth of Chinese imports and threatened duties on around $267 billion more if Beijing retaliated, which it has done.

The euro dipped briefly after the PMI data but then recovered as investors gravitated to the view the latest exchange of tariffs between the United States and China may be less damaging than initially feared.

Economists polled by Reuters earlier this month unanimously said the US-China trade war threatened the outlook for the Eurozone and that economic growth will be modest at best over the coming year.

Still, the ECB plans to phase out its asset buying programme this year and is expected to start interest rate hikes next autumn.

“As the index is still consistent with a fairly decent pace of growth, the ECB is unlikely to change its plans to normalise policy very gradually,” said Jessica Hinds at Capital Economics.

IHS Markit said the composite PMI, which dipped in September to 54.2 from 54.5, below a median forecast in a Reuters poll for 54.4, pointed to GDP increasing 0.5 per cent this quarter. The Reuters poll predicted 0.4 per cent growth.

It was a similar story in the bloc’s two biggest economies.

Earlier figures from Germany and France, the only two Eurozone members for which flash data are published, showed growth slowed in both countries by more than was expected.

A Eurozone composite future output index, which measures optimism, rose to 61.9 from August’s 23-month low of 61.6. But official figures released on Thursday showed consumer confidence fell in September by more than expected.

Services firms increased headcount at the same strong pace as in August. The employment index — which is a lagging indicator — held steady at August’s 55.3, a level which had not been seen since October 2007.