–Germany Accounts For Much Of Rise
By Laurie Laird
LONDON (MaceNews) — Business activity at European factories accelerated to a more than two-year high in October, according to purchasing managers’ indexes released by IHS Markit on Monday, confirming the European Central Bank’s forecast of continuing industrial strength.
The Eurozone manufacturing PMI jumped to 54.8 last month, exceeding the flash estimate of 54.4, from 53.7 in September. That’s the fourth straight increase, taking the index to its highest level in 27 months.
ECB President Christine Lagarde noted the strength of the manufacturing sector following the Bank’s Governing Council meeting last week, while voicing concern over the state of the bloc’s dominant service sector, particularly after the imposition of national lockdowns in a number of EU countries, including German and France. Factories and construction sites will remain operational.
The German manufacturing sector did much of the heavy lifting, with Germany’s PMI rising to 58.2 in October — the highest level since March of 2018 — from 56.4 in September. However, output expectations amongst Germany manufacturers fell for the first time in seven months, while employment suffered the 20th straight decline.
Italy’s manufacturing index increased to 53.8 from 53.2, while Spain’s PMI increased to 52.5 from 50.8. French output rose only modestly, with the PMI edging up to 51.3 from 51.2 in September.
Indexes declined in the Netherlands, Ireland and Greece, with the Greek PMI falling to a three-month low of 48.7, below the 50 level that separates expansion from contraction.
IHS Markit will release service-sector and composite PMIs on Wednesday.