Spain, Italy, Germany beat expectations in November PMI
Dec 02, 2015 09:55 AM EST
The Eurozone is witnessing an encouraging growth as the November data on Purchasing Mangers' Indices (PMI) was at 52.8.
Spain, Italy and Germany have surpassed expectations, while France was caught in holding pattern for the past three months.
Barring Greece, all European nations recorded growth in production and new orders. Netherlands and Ireland recorded their best growth rates during the month.
According to financial information services firm Markit, the Eurozone's manufacturing activity gained momentum in November.
The surge in industrial production and new orders was fastest during the past 18 months. Except Greece, remaining Euro nations witnessed growth in output and new business inflows.
PMI above 50 indicates good growth level and anything below it signals contraction in the economy. With 52.8 PMI in November, Eurozone manufacturing PMI is highest since April 2014. The PMI for Eurozone continued above 50 level for 29 months in a row.
Germany and Spain just edged up in PMI ranking for November. Austria fell to the sixth position while France slightly improved to fifth. With the struggling economy, Greece stood at the bottom level.
France economy was marginally up 0.3 percent in the third quarter. The surge in domestic demand was the prime reason for economic growth as foreign trade was declined during the quarter.
After the terrorist attack in Paris on 13 November, President Francois Hollande has imposed a national state of emergency. Focus Economics notes France is increasing investment in the defense sector.
Greece PMI of 48.1 was far above than its 30.2 in July. The economic reforms, bailout plan and new orders are helping the Greece economy and this is indicated in improvement in PMI rankings.
Factory output in Italy, Eurozone's third largest economy, reached a four-month high level in November.
The PMI for Italy's manufacturing sector rose 54.9 in November from 54.1 in October. Italy has been above 50 PMI for the tenth consecutive month. The weaker Euro and easing commodity prices are benefiting Italian manufacturers. Adding to this, the domestic demand is picking up encouragingly.
New Export business improved for Germany, Italy, Spain, Ireland, the Netherlands and Austria. On the other hand, France and Greece suffered a drop in new export business. Eurozone's manufacturing employment was up for the consecutive fifteenth month.
German factory output in November rose to highest in the past three months. Europe's largest economy is coming out of the impact of Volkswagen's emission scandal and weathering the slowdown in emerging markets.
The PMI for German's manufacturing sector rose to 52.9 in November from 52.1 in October as against the Reuters' forecast of 52.6.
The German exporters are benefiting from weaker euro as it generated more demand from abroad. The Euro against the US dollar fell to seven-month low.