Eurozone PMI November 2016

Eurozone

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.”

FocusEconomics Consensus Forecast panelists expect the Eurozone economy to expand 1.6% in 2016, which is unchanged from last month’s forecast. For 2017, panelists expect the economy to expand 1.4%, which is also unchanged from last month’s forecast.


Author: Angela Bouzanis, Senior Economist

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Euro PMI November 2016

Note: Markit Purchasing Managers’ Index (PMI) Composite Output. A reading above 50 indicates an expansion in business activity while a value below 50 points to a contraction
Source: IHS Markit


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