Eurozone service firms enjoy March, but factories struggle – #Eurozone #service #firms #enjoy #March #factories #struggle
Summary Eurozone March PMI 54.1, 10 is a monthly high. Data suggests the euro zone will avoid recession, but growth is unbalanced as factory activity declines.
LONDON, March 24 (Reuters) – Euro zone business activity picked up unexpectedly this month as consumers jumped into services, but weaker demand for manufactured goods deepened a slump in the factory sector, surveys showed.
Friday’s data proves that the bloc will avoid recession and 20 shows that the country’s economy is sustainable at least in the near term and potentially Europe It gives the Central Bank room to continue its tightening policy.
Germany’s Bundesbank President Joachim Nagel said on Friday that the ECB’s 2% inflation will fulfill its mandate and monetary policy must be persistently tight to do so.
But in the last two weeks USA and of Europe bank confusion in the sector 20Sentiment remains subdued as memories of the 2008 global financial crisis revive.
Still, S&P Global’s Flash Composite Purchasing Managers’ Index (PMI), seen as a good indicator of overall economic health, rose from 52.0 in February to 52.0 in March. 10 rose to a monthly high of 54.1.
That was well above the 50 mark that separates growth from contraction, and well above all forecasts in a Reuters poll of a decline to 51.9.
“Strong Eurozone PMIs for March point to confidence that the economy expanded in the first quarter, while both employment conditions and price pressures remain very strong,” said Franziska Palmas of Capital Economics.
S&P Global, pollflour It said it was in line with GDP growth of 0.3% in the first quarter, accelerating to an equivalent rate of 0.5% in March alone. A Reuters poll in early March had forecast gross domestic product (GDP) to contract by 0.1% this quarter.
10 Firm demand, which reached the highest level of the month, meant that firms could not fulfill all orders for the first time since June. The job index rebounded to 50.1 from 49.5, which was just above the loss.
Germany’s PMI indicator showed that growth in Germany was offset by a decline in production in Europe’s largest economy compensation boosted by a revival in services rather than doing.
Business activity strengthened more than forecast as the eurozone’s second-largest economy benefited from growth in the dominant services sector in France it was a similar story.
In Britain, outside the euro zone, services companies reported a second straight month of growth in March, suggesting the overall economy expanded in early 2023 and that businesses were also more optimistic about their outlook for next year.
According to official data, cash tight Britain households cut back on eating out and eating out last month, but buying food at supermarkets and shopping at discount stores gave retail sales an unexpected boost.
SERVICES SHINE
The PMI, which covers the euro zone’s dominant services industry, rose to 55.6 from 52.7 this month, well above all forecasts in a Reuters poll of a fall to 52.5.
To cope with the surge in activity, firms hired at the fastest pace since May last year. The employment index increased from 51.9 to 54.3.
However, it was a different picture for the factories. The headline manufacturing PMI fell to 47.1 from 48.5 in February, beating expectations for a rise to 49.0 in a Reuters poll.
The index measuring output, which is included in the composite PMI, fell to 49.9 from 50.1 last month.
“Growth remains unbalanced as services pick up unexpectedly as manufacturing output and new orders fall,” said Paolo Grignani of Oxford Economics.
Record advances in supply chains, raw material costs 20 as the COVID pandemic grips the world20It meant that it fell for the first time since June. Eurozone PMI input costs index fell to 46.4 from 50.9.
This is likely bank despite recent turmoil in the sector, inflation will be welcomed by ECB policymakers who raised interest rates last week, sticking to the fight against
“With the employment index still rising, it is clear that price pressures remain high. This puts us at ease with our forecast for the ECB to raise the deposit rate by a further 100bps to 4.00%,” said Palmas.
Reporting by Jonathan Cable; Edited by Susan Fenton and Mark Heinrich
Our standards: Thomson Reuters Trust Principles.
2023-03-24 16:19:46
Source – reuters
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