Eurozone business activity growth declined in June as the economy was weighed down by fears of the effects of high interest rates and concerns over demand growth, according to data compiled by S&P Global.

The data showed that the flash composite Purchasing Managers’ Index (PMI) fell to 50.3 in June from 52.8 in May. The threshold PMI reading is 50, with anything over than number signaling an expansion of business activity, and anything under it signaling a contraction. The indicator is now at a five-month low.

In a press release, S&P Global said, “Eurozone business output growth came close to stalling in June, pointing to renewed weakness in the economy after the brief growth revival recorded in the spring.”

It added, “Although energy and supply chain worries have eased since late last year, June has seen a further escalation of concerns over demand growth, and in particular the impact of higher interest rates, and the resulting possibilities of recessions both in domestic markets and further afield.”

France led the decline, after its business environment was hit with worker strikes, while Germany followed behind after factory orders slumped. Analysts pointed out that manufacturing was the “principal area of weakness” for overall business activity in June, with service sector expansion also having “slowed sharply.”

Chris Williamson, chief business economist at S&P Global Market Intelligence, said in an interview with CNBC that the numbers were “worrying,” noting that rising interest rates and the increase in the cost of living were “all beginning to take their toll” on the region’s economic momentum.

For the past year the European Central Bank has repeatedly raised interest rates as it has battled with a persistently high inflation. S&P economists have warned that any further rate increases could plunge the Eurozone into a recession by increasing borrowing costs for businesses, which would place downward pressures on production output.