Eurozone: Composite PMI rises to highest level since December 2015
November 23, 2016
Recent data suggest that business activity in the Euro area has picked up momentum. The preliminary Eurozone Composite Purchasing Managers’ Index (PMI), produced by IHS Markit, rose from 53.7 in October to 54.1 in November, the highest reading since December 2015. The result overshot market analysts’ expectations of a slight decline to 53.2.
November’s upbeat reading reflected stronger activity in both the manufacturing and services sectors. Employment grew at the fastest pace since 2008 and prices charged rose, suggesting inflation is returning to the common-currency bloc. New orders surged in November and backlogs of work rose at the fastest pace since November 2011.
Regarding the two largest Eurozone economies, economic conditions improved notably in France and remained strong in Germany. Elsewhere in the region, economic momentum picked up to a ten-month high and employment surged. Commenting on the result, IHS Market analysts stated that, “the PMI readings so far for the fourth quarter point to GDP expanding 0.4%, led by a rebound in German growth to 0.5%. France is also seen to be enjoying its best spell since the start of the year, with the PMIs signalling GDP growth of 0.2-0.3% in the fourth quarter.”