(Reuters) – Euro zone business activity grew at its weakest pace in five months in September as curbs to limit the Delta variant of coronavirus hit demand and supply-chain constraints pushed input costs to a more than two-decade high, a survey showed on Thursday.

Although daily infection rates have been declining significantly over the past month in France and Germany, it is unlikely that any restrictions will be lifted soon. This could be due to concern over the future course of the pandemic.

The Flash Composite Purchasing Managements’ Index by IHS Markit, which is a useful indicator of economic health overall, dropped to 56.1 in September, from 59.0 last August.

Although the index was above 50, which is the mark that distinguishes between growth and contraction for seven consecutive months, it still fell below the Reuters poll estimate at 58.5.

Chris Williamson of IHS Markit’s chief business economist said that the flash PMI for September showed a disturbing combination of slow economic growth and rising prices.

The price and supply headwinds will continue to affect growth, particularly if they are accompanied with an increase in viruses cases. “Growth is likely to decline further over the next months,” said Chris Williamson, chief business economist at IHS Markit.

The sub-index that tracks input costs reached 70.5. This is the highest level in over two decades. This suggests that supply distortions, which have been a major driver of global prices over the past few months, are still not solved and that the trend towards higher inflation will continue at least for the next few months.

Indeed, optimism about future output fell to an eight-month low. The latest data of the European Commission show that this is in contrast to rising consumer confidence.

PMI, which measures the dominance of the bloc’s service industry, fell to 56.3 from 59.0 last August. It was significantly lower than the Reuters poll projection of 58.5.

In September, the PMI that measures sector demand – called new business – experienced its slowest expansion in five years.

The manufacturing PMI fell to 58.7 in August from 61.4. This was its lowest level since February, and it is below the Reuters poll prediction of 60. The composite PMI index measures output and fell from 59.0 to 55.6. This is the lowest reading in eight months.

Firms hired at their slowest rate in six months due to weakening demand. The backlogs of work grew at an alarming rate, indicating worsening supply problems.