Signs that manufacturing weakness is spreading across the euro zone are troubling ECB policymakers. The European Central Bank has restarted its 2.6 trillion euro bond buying program after cutting interest rates in September.
Lagarde, the new president of the European Central Bank, will have to bridge differences between policymakers representing rich countries such as Germany, the Netherlands and France, who oppose the decision to resume debt purchases, and those representing struggling second tier countries.
However, manufacturing woes seem to be widespread, with manufacturing activity in Germany, Europe's largest economy, still mired in recession last month as new orders fell for the 13th month in a row, with factory layoffs at the highest level in nearly a decade.
Manufacturing activity in Italy fell for the 13th consecutive month, while manufacturing activity in Spain shrank for the fifth consecutive month, suffering from political turmoil at home and abroad.
However, France, one of the four largest economies in the eurozone, bucked the trend, with moderate expansion of manufacturing activity, which could be helped by the government's multi billion euro stimulus plan.
The euro zone Manufacturing Purchasing Managers' index (PMI) ended at 45.9 in October, just above the seven-year low of 45.7 set in September, the ninth consecutive month below the 50 mark, IHS Markit said.
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