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LONDON (Reuters) - The downturn in euro zone manufacturing eased further in May, coming close to stabilisation as production increased for the third consecutive month and supported by a near-stabilisation in demand, a survey showed on Monday.

The HCOB Eurozone Manufacturing Purchasing Managers' Index rose to 49.4 in May from 49.0 in April, marking a 33-month high and in line with a preliminary estimate but remaining below the 50.0 threshold separating growth from contraction.

Germany remained the weakest performer among the major economies with a PMI of 48.3, though its manufacturing sector recorded one of the softest deteriorations in three years.

Manufacturers' confidence about the year ahead rebounded to its highest level since February 2022 despite concerns about potential U.S. tariff increases on European imports. The future output index bounced to 61.6 from 58.0.

Input costs declined for the second consecutive month with the reduction accelerating to the fastest pace in 14 months. In response, factories cut their selling prices for the first time since February.

"The ECB is getting some tailwinds for its expected interest rate cuts. The industrial sector has started cutting its sales prices again after two months of increases, giving the central bank some extra room to move forward with its interest rate cuts," de la Rubia said.

All 81 economists polled by Reuters expected the ECB to cut its deposit rate again on Thursday with a majority predicting at least one more cut after June.

(Reporting by Jonathan Cable; Editing by Toby Chopra)