Economic activity in the eurozone plummeted in July, a key survey showed Friday, with a big drop in manufacturing and high prices putting the brakes on consumers' post-lockdown spending sprees.

The closely-watched S&P Global monthly purchase managers' index (PMI) fell from 52.0 in June to 49.4, below the 50-point level that separates contraction and growth.

"Excluding pandemic lockdown months, July's contraction is the first signaled by the PMI since June 2013," and pointed to negative growth in GDP, said Chris Williamson, chief business economist at S&P Global, Reuters reported. 

"Although only modest at present, a steep loss of new orders, falling backlogs of work and gloomier business expectations all point to the rate of decline gathering further momentum as the summer progresses," he said. 

The survey showed that the steepest decline in activity was felt in Germany, as the exporting powerhouse suffered the effects of high prices and anemic demand for its high-quality products.

S&P also pointed to the negative effects of tighter monetary conditions. The European Central Bank (ECB) raised interest rates by more than expected on Thursday, confirming that concerns about runaway inflation now trump growth considerations.

Inflation in the currency union was 8.6 percent in June, official data showed, above the ECB's 2 percent target. The year-on-year price growth hit 6.5 percent in France, 8.1 percent in Finland and 8.2 percent in Germany, last month.

(With input from agencies)