Eurozone service sector gets out of recession levels

Date: Friday 03 Feb 2012

The purchasing managers' index (PMI) for the service sector, as compiled by Markit Economics, has revealed that the Eurozone economic slowdown could have reversed course with the services and manufacturing sector out of recession levels.

The Eurozone’s final services PMI for January reached a five-month high at 50.4, up from 48.8 in the previous month. The preliminary reading had been 50.5. This places the indicator above the 50 threshold, indicating an expansion.

Final PMI composite for January, which averages out the manufacturing and service sectors, also registered a five-month high at 50.4, compared to the previous 48.3.

Looking at the Eurozone members:

In Spain, PMI services reached a five-month high at 46.1 compared to the previous 42.1.

In Italy, PMI services rose to a two-month high at 44.8 compared to the previous 44.5.

In France, PMI services reached a five-month high at 52.3 compared to the previous 50.3.

In Germany, final PMI services reached a seven-month high at 53.7 compared to the previous 52.4.

According to Digital Look, this data is positive as it coincides with "uplifting data from the industrial sector."

"As such, Europe may avoid another recession. The slowdown to the Eurozone’s GDP over the last two quarters may be reaching an end. The readings for the next two months will be key," they said.

FM

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