Daily Times

BRUSSELS: A survey has revealed that the eurozone economy had grown at its fastest pace in previous six years leading up to February, as all signs pointed to it maintaining “strong momentum”.

Data monitoring company IHS Markit also said job creation in the 19-country eurozone recorded its best level for nearly a decade.

It said its February composite Purchasing Managers Index (PMI) came in at 56.0 points, up from 54.4 points in January, with growth accelerating in both manufacturing and services.

“The latest reading was the highest since April 2011,” the survey said. “February saw the largest monthly rise in employment since August 2007.”

The PMI measures companies’ willingness to spend on their business and so gives a good idea of how well the underlying economy is performing.

Any reading above the boom-bust 50 points line indicates the economy is expanding.

It said the rise in job creation, order book growth and business optimism all boded “well for the recovery to maintain strong momentum in coming months”.

IHS Markit Chief Business Economist Chris Williamson said that eurozone growth could amount to 0.6 percent in the first quarter if the trend continues.

Both France and Germany experienced robust growth where composite PMIs of 56.2 and 56.1 were recorded respectively. The service sector saw faster growth in France, while manufacturing led the surge in Germany.

“The big surprise was France, where the PMI inched above that of Germany for the first time since August 2012,” Williamson said.

“France’s revival represents a much-needed broadening out of the region’s recovery and bodes well for the eurozone’s upturn to become more self sustaining,” he said in a statement.

He said the European Central Bank (ECB) would be encouraged by both signs of stronger growth and inflationary pressure. But it would be wary of how elections in France and Germany as well as the fallout from Brexit could disrupt business activity.

The ECB was unlikely to alter its current ultra-loose monetary at least until after German elections in September, Williamson added.

The Eurostat statistics agency said at the end of January the eurozone jobless rate fell to a lower than expected 9.6 percent in the last month of 2016.