Euro zone manufacturing activity dropped to a three-month low in March, with the "malaise" spreading to top economies Germany and France.

The Purchasing Managers Index, a survey of 3,000 euro zone manufacturers compiled by Markit research firm, fell to 47.7 points in March, down from 49 points in February.

A score below the neutral 50 mark indicates contraction.

''Euro zone manufacturers suffered a miserable March, with a renewed downturn in production wiping out marginal gains seen in the first two months of the year," said Markit chief economist Chris Williamson.

"Manufacturing is therefore likely to have acted as a drag on economic growth in the euro zone in the first quarter, falling to a lesser extent than in the final quarter of last year but nevertheless failing to prevent the economy sliding back into recession," he said.

The research firm said there were "further signs that the manufacturing malaise already exhibited at the periphery of the currency bloc was spreading to the core."

Germany's manufacturing PMI fell to 48.4 points in March, the first time it drops below the 50 mark this year. France sank to 46.7 points, the steepest contraction since June 2009.

"Ongoing steep downturns in the periphery are now being accompanied by signs of renewed weakness in countries such as Germany and France," Williamson said.

A decline in new orders and the rise in oil prices, which weighed on production costs, contributed to the decline in euro zone manufacturing activity, Markit said.

Analysts widely believe the euro zone entered recession this year after the economy shrank by 0.3% in the last quarter of 2011. A recession is defined as two consecutive months of economic contraction.

 

'Euro zone manufacturers suffered a miserable March, with a renewed downturn in production wiping out marginal gains seen in the first two months of the year," said Markit chief economist Chris Williamson.

"Manufacturing is therefore likely to have acted as a drag on economic growth in the euro zone in the first quarter, falling to a lesser extent than in the final quarter of last year but nevertheless failing to prevent the economy sliding back into recession," he said.

The research firm said there were "further signs that the manufacturing malaise already exhibited at the periphery of the currency bloc was spreading to the core."

Germany's manufacturing PMI fell to 48.4 points in March, the first time it drops below the 50 mark this year. France sank to 46.7 points, the steepest contraction since June 2009.

"Ongoing steep downturns in the periphery are now being accompanied by signs of renewed weakness in countries such as Germany and France," Williamson said.

A decline in new orders and the rise in oil prices, which weighed on production costs, contributed to the decline in euro zone manufacturing activity, Markit said.

Analysts widely believe the euro zone entered recession this year after the economy shrank by 0.3% in the last quarter of 2011. A recession is defined as two consecutive months of economic contraction.