Eurozone private sector activity expanded strongly in December underpinned by broad based growth in manufacturing and services, flash data from Markit showed Wednesday. Nonetheless, the pace of expansion eased marginally from November.
Elsewhere, the statistical office revised up its inflation figures for November. Accordingly, inflation rose to 0.2 percent from 0.1 percent in October. The annual rate for November was revised up from 0.1 percent.
The Markit’s composite output index fell to 54 in December from 54.2 in November. However, a reading above 50 indicates expansion in the sector. It was forecast to remain unchanged at 54.2.
The expansion seen in December was sufficient to complete the strongest quarter of growth recorded by the survey for four-and-a-half years, Markit said.
The manufacturing Purchasing Managers’ Index hit a 20-month high in December, outpacing the expansion in services for the first time in over a year. The indicator came in at 53.1, up from 52.8 in November.
Meanwhile, the services PMI fell to a 3-month low of 53.9 from 54.2 a month ago. Economists expected a score of 54.
Chris Williamson, chief economist at Markit said, the survey is signaling quarterly GDP growth of 0.4 percent, translating to 1.5 percent growth in 2015.
The survey suggests that the euro-zone economy is still recovering steadily, Jennifer McKeown at Capital Economics, said. But growth is not strong enough to generate inflationary pressure, she noted.
As such, pressure is likely to mount on the European Central Bank to offer bolder policy support after its disappointingly timid action earlier this month, McKeown said.
While the PMI surveys signaled ongoing solid growth in Germany, rounding off the best quarter in one-and-a-half years, France slowed closer to stagnation.
Germany’s composite output index slid to 54.9 in December from 55.2 in November. Output growth slowed fractionally at both manufacturers and service providers.
The services PMI fell to 55.4 from 55.6 in November. It was slightly below the expected score of 55.5.
On the other hand, the manufacturing PMI rose slightly to 53 from 52.9 a month ago. Economists had forecast the index to fall to 52.8.
On the other hand, the French private sector growth slowed to a four-month low in December. The flash composite output index fell to 50.3 in December from 51 in November.
The drop in the headline index reflected a stagnation of service sector business activity, ending a ten-month period of expansion. In contrast, manufacturing sector output rose at a slightly faster pace.
The services PMI dropped to a 11-month low of 50 in December from 51.0 in November. It was expected to fall slightly to 50.8.
Meanwhile, the manufacturing PMI rose to a 21-month high of 51.6 from 50.6 in November. Economists had forecast the reading to remain unchanged in December.
The material has been provided by InstaForex Company – www.instaforex.com