The eurozone private sector activity rebounded at the fastest pace since last September, following January’s slowdown, final survey results from IHS Markit showed on Thursday.
The composite output index rose to 55.5 in February from 52.3 in the previous month. The flash reading was 55.8.
Overall, the index signaled the strongest increase in combined manufacturing and services output since last September. By sector, rates of output growth were of equal strength at manufacturers and service providers.
The services Purchasing Managers’ Index came in at 55.5, up from 51.1 a month ago. The reading was revised from 55.8.
Business activity accelerated to a pace commensurate with GDP growth in excess of 0.6 percent, buoyed by a relaxation of virus restrictions, Chris Williamson, chief business economist at IHS Markit said.
With inflation risks rising and growth prospects waning, the Ukraine conflict adds to business and household headwinds for the coming months, and exacerbates the difficult juggling act of the ECB in controlling inflation while sustaining a robust economic recovery, Williamson noted.
The survey showed that demand for euro area goods and services increased the most since September. The pace of job creation also gathered momentum, improving to a three-month high.
There was a stronger level of business optimism in February. However, data highlighted additional strain on operating capacities.
On the price front, the survey revealed that input price inflation was the second-quickest on record. At the same time, selling price inflation hit a survey high.
The German private sector enjoyed its strongest growth for six months in February. Nonetheless, the final composite output index improved less than initially estimated to 55.6 from 53.8 in January. The flash score was 56.2.
Similarly, the services PMI rose to 55.8, up from 52.2 in January, but down from the flash 56.6.
France’s private sector business activity grew at a faster rate in February, gaining momentum once again after the slump in January caused by resurgent COVID-19 cases.
The final composite output index increased to 55.5 in February, up from January’s nine-month low of 52.7 but below the flash 57.4. Likewise, the services PMI also came in at 55.5 versus 53.1 a month ago. The preliminary reading was 57.9.
Italy’s private sector growth accelerated as services output rebounded in February. The composite output index advanced to 53.6 in February, up from 50.1 in January. The services business activity index rebounded back above the 50.0 mark, rising from 48.5 in January to 52.8 in February.
Spain’s manufacturing and service industries expanded at similarly strong rates, ensuring that the private sector economy enjoyed a noticeable rebound of activity in February.
The composite output index improved to 56.5, up from 47.9 in the previous month. The services index posted 56.6, up from 46.6 a month ago.
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