A welder apprentice works in a training center in Siegburg, Germany.
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LONDON – Eurozone business grew the fastest in 15 years this month, according to preliminary data released on Wednesday.
The 19 economies have recently taken various steps to reopen their economies as vaccination programs continue to accelerate. France, for example, has lifted a night curfew and the need to wear a face mask outdoors. Italians can now, as is their tradition, leave their coffee on a counter after eating has resumed indoors. In addition, more tourists are now welcomed to the region.
IHS Markit’s composite flash PMI for the euro area, which studies activity in both manufacturing and services, hit 59.2 in June, up from 57.1 in May. A value above 50 means an expansion of economic activity.
According to IHS Markit, this was the highest value in 180 months or 15 years.
“Very encouraging signs that the recovery is picking up pace,” IHS Markit chief economist Chris Williamson told CNBC’s Street Signs Europe on Wednesday.
“The fastest growth in business in 15 years, demand in terms of orders is also growing at the fastest rate in 15 years, which is what drives this, and employment growth is also accelerating well, so it’s a general recovery that is winning the air.” too, “he added.
The European Central Bank estimated earlier this month that the euro zone would grow at a rate of 4.6% this year and 4.7% next year – a stronger outlook from its March assessment.
Economic uncertainty remains, however, especially due to the delta coronavirus variant, which leads to higher infections, as well as labor market shortages – even in countries with relatively high unemployment rates.
“What we have seen so far is certainly the hospitality sector, hotels and restaurants that seem to be the hardest hit. There is a lot of pressure there to recruit enough staff quickly to meet the growing demand, and it will only get worse as we see these economies reopen again in July, “said Williamson.
French companies experience successive expansions
Flash France’s composite production index hit 57.1 in June from 57.0 in May, an 11-month high. The recent lifting of the Covid-19 restrictions contributed to a higher number of sales. New orders from manufacturers also saw one of the fastest increases since the pandemic in 2020.
Joe Hayes, Senior Economist at IHS Markit, said: “The French economy has had its best quarterly performance since early 2018.”
“With vaccination rates soaring, survey data suggests companies are becoming more confident that the conditions are in place for an economic recovery,” he said, adding that “the recovery could get some boosts of speed if the supply side ultimately holds up.” Economy back. “
Meanwhile, the Flash Germany PMI composite production index hit 60.4 in June from 56.2 in May, a 123-month high.
“The further easing of the Covid-19 restrictions has given the recovery of the German economy an additional boost, with the ‘Flash’ PMI rising steeply to its highest level in over a decade. And with containment measures expected to continue lifting in July, that strong momentum is expected to carry over into the third quarter, “Phil Smith, associate director at IHS Markit, said in a statement.
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