Eurozone Services Activity Lifts Private Sector Growth To 11-Month High
04 Maggio 2023 - 10:10AM
RTTF2
The euro area private sector economy expanded at the fastest
pace in almost a year in April solely reflecting the growth in
services activity, final data from S&P Global showed
Thursday.
The HCOB final composite output index improved to 54.1 in April
from 53.7 in March. The score has remained above the crucial 50.0
level for the fourth straight month. However, the reading was below
the flash estimate of 54.4.
The manufacturing sector contracted for the tenth consecutive
month in April with the latest drop being the biggest since May
2020. Meanwhile, the upturn in the service sector was the fourth in
as many months and well above the average in the survey
history.
The services Purchasing Managers' Index advanced to 56.2 from
55.0 in the previous month, the survey showed. The flash reading
was 56.6.
The overall private sector growth strengthened to an 11-month
high, following accelerated upturns in both February and March.
New order inflows grew the most since May 2022. That said higher
business was limited to domestic market. Export orders decreased
for a fourteenth month in a row.
The increase in business activity again outpaced the improvement
in orders. As a result, backlogs of work declined further.
Firms lifted employment for a twenty-seventh straight month in
order to tackle their unfilled orders. The pace of job creation was
the biggest since last May.
Regarding prices, the survey showed that input price inflation
eased to a 26-month low in April despite rising wage costs. Output
prices increased at the weakest pace in two years but remained
historically sharp.
Although firms remained optimistic towards the next twelve
months, the degree of positivity weakened slightly to a three-month
low.
"Across all HCOB PMI indicators, however, everything suggests
that growth in the eurozone services sector will continue in the
months ahead," Cyrus de la Rubia, Hamburg Commercial Bank chief
economist said.
The survey showed broad-based growth across the member
countries. Spain was once again the fastest growing economy and
Italy posted the strongest upturn in one-and-a-half years. Italy
and Spain were the main driving forces behind the private sector
growth. Stronger momentum was also reported in Germany and
France.
Germany's private sector growth quickened to a one-year high in
April, underpinned by faster growth in services activity. At 54.2,
the composite output index rose from 52.6 in March. The reading was
also above the flash 53.9.
The services PMI advanced more than initially estimated to 56.0
from 53.7 in the previous month. The flash score was 55.7.
However, France's private sector growth slowed in April as the
improvement in services activity was restrained by the biggest fall
in manufacturing output for nearly three years.
The composite PMI slid to 52.4 from 52.7 in the previous month
and also remained below the initial estimate of 53.8. The services
PMI advanced to 54.6 from 53.9 in March. The flash score was
56.3.
Italy's private sector showed a two-speed performance in April.
Manufacturing output shrank for the first time in 2023, while
services activity grew the most since August 2021.
The composite output index rose only marginally to 55.3 from
55.2. The services PMI posted 57.6 in April, up from 55.7 in March
and economists' forecast of 56.5.
Spain's private sector expanded markedly in April. However, the
corresponding indicator dropped to 56.3 from 58.2 in March. At the
same time, the services PMI registered 57.9, down from 59.4 a month
ago. The score was forecast to improve to 59.9.
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