2024-03-21 12:18:00
Eurozone private sector activity rose to a 9-month high of 49.9 in March, but continued weakness in the bloc’s two largest economies, France and Germany, was a key headwind for the bloc. As Day.Az reports, Bloomberg writes about this.
The S&P Global composite PMI beat economists’ expectations at 49.7, approaching the 50 mark that separates growth from contraction. This growth was driven only by the services sector; the manufacturing index unexpectedly fell.
Despite the overall improvement, the economies of Germany and France continue to lag significantly, indicating an uneven recovery, Hamburg Commercial Bank said.
The eurozone avoided a recession at the end of 2023, but economists forecast growth of just 0.1% in the first quarter and 0.5% by the end of 2024.
Important German manufacturers again disappointed economists’ forecasts – their index fell to 41.6 from 42.5 in February.
“Germany is not returning to its growth trajectory,” said Cyrus de la Rubia, chief economist at the Hamburg Commercial Bank.
In France, confidence indicators in industry and services have improved. The Insee Composite Index reached an average of 100 in March for the first time in six months.
“The ECB can take comfort from the lack of rising price pressures in the services sector. However, prices are still high, so price data is not enough to change the ECB’s plans to cut rates in June,” de la Rubia said.
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