Euro zone private sector sees fastest growth rate since 2006
Published: 03:08 PM,Aug 04,2021 | EDITED : 07:08 PM,Aug 04,2021
Employees assemble a car at Porsche AG plant in Stuttgart, southern Germany. — AFP
BRUSSELS: The euro area private sector grew the most in more than 15 years in July, underpinned by steep manufacturing output growth and an accelerated expansion of services activity, data from IHS Markit showed.
The composite output index rose to 60.2 in July, from 59.5 in the previous month. But the reading was below the flash score of 60.6. A score above the neutral 50.0 indicates expansion in the sector.
This was the longest uninterrupted sequence of expansion since the pandemic began early last year. Services activity grew at its fastest pace since mid-2006. Although manufacturing production rose at its softest rate in five months, the expansion outstripped that seen in the services sector.
Easing virus restrictions and further vaccination progress are boosting demand for a wide variety of activities in the service sector. The final services purchasing managers’ index (PMI) advanced to 59.8, from 58.3 in June. However, this was below the flash 60.4.
“Alongside the sustained elevated growth recorded in the manufacturing sector, the impressive strength of the service sector’s expansion in July means the eurozone should see GDP [gross domestic product] growth accelerate in the third quarter,” Chris Williamson, chief business economist at IHS Markit said.
Among the four largest eurozone economies, the fastest growth was seen in Germany, where again the rate of expansion accelerated to a record high.
In Italy, private sector activity growth jumped to a three-and-a-half year high, while Spain and France registered softer increases in output.
Germany’s private sector growth surpassed the previous record set in June 2006. The composite output index advanced to 62.4 in July, from 60.1 in June. The flash score was 62.5.
Strong increases in activity were seen across both the manufacturing and service sectors. The services PMI came in at 61.8, compared to 57.5 in June and the flash 62.2.
France’s private sector growth slowed from June’s 41-month high in July. The composite PMI slid to 56.6, from 57.4. The flash reading was 56.8. But the score was consistent with sharp expansion when compared with those seen over the past three-and-a-half years.
At 56.8, the services PMI was down from 57.8 in June and the flash57.0. Nonetheless, the sector expanded for the fourth straight month. — Reuters
The composite output index rose to 60.2 in July, from 59.5 in the previous month. But the reading was below the flash score of 60.6. A score above the neutral 50.0 indicates expansion in the sector.
This was the longest uninterrupted sequence of expansion since the pandemic began early last year. Services activity grew at its fastest pace since mid-2006. Although manufacturing production rose at its softest rate in five months, the expansion outstripped that seen in the services sector.
Easing virus restrictions and further vaccination progress are boosting demand for a wide variety of activities in the service sector. The final services purchasing managers’ index (PMI) advanced to 59.8, from 58.3 in June. However, this was below the flash 60.4.
“Alongside the sustained elevated growth recorded in the manufacturing sector, the impressive strength of the service sector’s expansion in July means the eurozone should see GDP [gross domestic product] growth accelerate in the third quarter,” Chris Williamson, chief business economist at IHS Markit said.
Among the four largest eurozone economies, the fastest growth was seen in Germany, where again the rate of expansion accelerated to a record high.
In Italy, private sector activity growth jumped to a three-and-a-half year high, while Spain and France registered softer increases in output.
Germany’s private sector growth surpassed the previous record set in June 2006. The composite output index advanced to 62.4 in July, from 60.1 in June. The flash score was 62.5.
Strong increases in activity were seen across both the manufacturing and service sectors. The services PMI came in at 61.8, compared to 57.5 in June and the flash 62.2.
France’s private sector growth slowed from June’s 41-month high in July. The composite PMI slid to 56.6, from 57.4. The flash reading was 56.8. But the score was consistent with sharp expansion when compared with those seen over the past three-and-a-half years.
At 56.8, the services PMI was down from 57.8 in June and the flash57.0. Nonetheless, the sector expanded for the fourth straight month. — Reuters