Greece’s Purchasing Managers’ Index (PMI) eased to 43.1 points in December from 43.9 in November, its lowest reading since August, evidence of worsening conditions in the Greek manufacturing sector.

Incoming new orders fell in the last month of 2010 with the fastest rate since March 2009, reflecting worsening conditions in demand, domestic and abroad, while production levels also continued to fall rapidly.

The combination of adverse business conditions in tandem with strong competition prevented Greek manufacturers from raising their prices in December, with outflow prices falling for the 27th consecutive month despite a steep rise in inflow costs.

With revenues falling and inflow costs rising, Greek manufacturers sought ways to cut spending in December. As a result, purchasing activity, inventories and employment fell further in the month.

The purchasing managers’ index measures business activity in the manufacturing sector. Readings above 50 indicate a growing sector, while readings below 50 a shrinking sector.