LONDON (Reuters) – Eurozone private sector activity returned to growth in January, a survey released on Friday showed, suggesting the bloc’s economy could escape contraction again this quarter and the recovery could even accelerate.
Figures released by Eurostat on Tuesday showed the eurozone economy recorded unexpected growth in the fourth quarter of 2022, with GDP up 0.1% from the third quarter and 1.9% from the fourth quarter of 2021.
According to final results from the S&P Global Monthly Survey of Purchasing Managers, the composite PMI, considered a reliable barometer of the economy as a whole, rose to 50.3 in January, to a seven-month high, after 49.3 in December.
January marks the first month where this index is above the threshold of 50 delimiting growth and contraction of activity. In the first estimate, it came out at 50.2.
“A pick-up in growth in business output, however marginal, is good news and suggests the eurozone could escape a recession,” said Chris Williamson, chief economist at S&P Global Market Intelligence.
“In light of price pressures that have eased significantly in recent months, easing supply constraints, ebbing short-term concerns in the energy market and a mild winter, business confidence is on the rise. has also improved, raising hopes that the recovery will gather momentum in the coming months,” he added.
Although demand has fallen again, the new orders index has moved significantly closer to the break-even point and together with the rise in employment in the sector, this has boosted business sentiment for the year. underway, now at its highest since April. The future production index rose from 55.5 to 60.4.
Activity in the services sector alone also rebounded last month as consumers seemed to ignore the cost-of-living crisis, allowing demand to pick up modestly.
The services sector PMI came out last month at 50.8, the first rise above the 50 threshold since July. It was 49.8 in December and the “flash” estimate put it at 50.7 in January.
Regarding the producer price sub-index, it fell from 61.0 to 62.0, but this remains below the levels observed during most of the past year.
(Report Jonathan Cable; French version Claude Chendjou, edited by Blandine Hénault)
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