Euro Area Growth Highest In Three Months Say Markit

The euro area economy has found some momentum, and is now growing at its fastest rate since December last year, according to global financial information services company Markit.

Their flagship Purchasing Managers’ Index (PMI), which tracks business patterns, rose to a score of 53.7 in March, climbing up 0.7 month on month.

Although despite the monthly rise in performance, the Markit survey also discovered that their PMI reading for the first quarter this year was the lowest quarterly figure for a  year, at 53.4.

The euro area’s March revival was led by the services sector, where business grew at a three month high, reversing the 13 month low that the industry suffered in the February survey.

Expectations in the service sector are also higher for this year, with the new found optimism creating the second highest levels of anticipation seen over the past 11 months.

Manufacturing has also seen an increase in output, but only on  slender scale, improving on the 12 month low that was found in February’s survey.

Overall, employment  did rise, but it was only the smallest growth for jobs in the industry since September last year.

Prices continued to fall, with average input costs dropping for the third successive month.

This fuelled the driving down of average prices charged by firms for their goods and services, at the second fastest rate seen for just over a year.

Germany and France Growing Says Survey

Germany again saw growth in their economy Markit revealed, although the rate of economic expansion was on a par with what was recorded in February.

Service expansion remained solid, but manufacturing only grew at a modest pace, while new order growth was the weakest it has been for eight months, and job creation the slowest for 11 months.

France can be satisfied as  the survey found  that business activity rose again, after sliding into contraction in February.

Both manufacturing and services saw modest revivals in March. However, the overall rate of growth remained only modest, and job creation was closer to stagnation.

 UK Inflation Unchanged in February 

Official figures have revealed that inflation in the UK has remained unchanged at 0.3% for February, compared to the previous month.

The data will be disappointing, as the past three months have shown small increases in prices, and historically this is a relatively low figure.

Contributions from pricing groups, were relatively smaller compared to most months in influencing the index.

The largest downward contribution came from the transport sector, as items such as road passenger transport, second-hand cars and bicycles, recorded a fall in prices.

This was mostly offset by a rise in food prices, with vegetables increasing the most in costs.

The latest prices index, confirms a pattern that has emerged since the beginning of 2015, where prices for transport costs, food and non-alcoholic beverages, and recreational and cultural goods and services have pulled inflation downwards.

While these trends have been counterbalanced, by price rises for other goods and services, especially restaurant and hotel bills, and education costs such as university tuition fees.

The 0.3% figure, is still way behind the 2% inflation target set by the Bank of England.