Top Stories
Euro zone services hit in February but factories racing along – PMIs
Published by linker 5
Posted on February 19, 2021
Global Banking and Finance Review
Company
Global Banking and Finance Review is an online platform offering news, analysis, and opinion on the latest trends, developments, and innovations in the banking and finance industry worldwide. The platform covers a diverse range of topics, including banking, insurance, investment, wealth management, fintech, and regulatory issues. The website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.
Published by linker 5
Posted on February 19, 2021
By Jonathan Cable
LONDON (Reuters) – Business activity across the euro zone contracted again in February as lockdown measures to contain the coronavirus hammered the bloc’s dominant service industry, a survey showed, even as factories had their busiest month in three years.
With daily reported infections still high governments have been encouraging citizens to stay home and closed much of the continent’s hospitality industry while factories have largely remained open.
IHS Markit’s flash composite PMI, seen as a good guide to economic health, nudged closer to the 50 mark separating growth from contraction, registering 48.1 in February compared to January’s 47.8. A Reuters poll had predicted 48.0.
However, some of that activity was from completing old orders. The backlogs of work index fell to 47.9 from 49.0.
“Ongoing COVID-19 lockdown measures dealt a further blow to the euro zone’s service sector in February, adding to the likelihood of GDP falling again in the first quarter,” said Chris Williamson, chief business economist at IHS Markit.
The euro zone economy is in a double-dip recession, according to last week’s Reuters poll of economists, who said the risks to their already weak outlook was skewed more to the downside.
A PMI covering the services industry fell to 44.7 from January’s 45.4, well below the median expectation in a Reuters poll for 45.9.
But with vaccination programmes accelerating, driving hopes for a return to some form of normality, optimism about the year ahead improved sharply. The services business expectations index climbed to its highest since April 2018.
“Assuming vaccine roll-outs can boost service sector growth alongside a sustained strong manufacturing sector, the second half of the year should see a robust recovery take hold,” Williamson said.
Strong demand for manufactured goods helped the factory PMI soar to 57.7 from 54.8, the highest since February 2018 and well above all forecasts in a Reuters poll that predicted 54.3. An index measuring output, which feeds into the composite PMI, jumped to 57.5 from 54.6.
The new orders index also soared and factories hired additional staff for the first time in nearly two years. The employment index rose to 50.9 from 49.4.
(Reporting by Jonathan Cable; Editing by Hugh Lawson)