Euro zone business activity expanded a touch faster than expected last month as the region appeared, so far, to have largely shrugged off Britain’s vote to leave the European Union, a survey found.
The latest increase, which came alongside some of the fastest hiring growth in the euro zone since before the financial crisis in 2008, was led by a surge in Germany, masking stagnation in France and a slower pace in Spain and Italy.
Euro zone business growth is now in stark contrast to Britain, where a survey suggested its economy is shrinking at the fastest rate since the financial crisis after a sharp hit to activity following the EU referendum in June. [GB/PMIS]
Markit’s final composite Purchasing Managers’ Index for the euro zone, released on Wednesday, was 53.2 in July, above a flash estimate of 52.9 and June’s 53.1. It has been above the 50 mark that divides growth from contraction since mid-2013.
“The composite PMIs have held up a little better than people expected after the UK’s Brexit vote but that doesn’t change the fact that growth is still weak and not doing enough to pick up core inflation,” said Stephen Brown at Capital Economics.
“Even though the composite PMIs and surveys have done a bit better than expected that doesn’t change the fact that there is still pressure on the ECB to take more action.”