Euro-area eco­nomic growth re­mains ‘muted’ at be­gin­ning of this year

Muscat Daily - - BUSINESS -

Zurich, Switzer­land - The eu­roarea econ­omy con­tin­ued to trun­dle along at the be­gin­ning of 2020, de­spite signs of a pickup in Ger­many.

IHS Markit’s com­pos­ite Pur­chas­ing Man­agers’ In­dex (PMI) for the re­gion stayed at 50.9 in Jan­uary, fall­ing short of the 51.2 me­dian fore­cast of econ­o­mists. There was a drag from France, where strikes hit the ser­vices sec­tor, which off­set an im­prove­ment in Ger­many.

Weak­ness also per­sisted else­where in the re­gion, with out­put growth there slow­ing to the low­est in six and half years. Fig­ures for other coun­tries will only be avail­able next month.

The euro-area ser­vices PMI slipped slightly in Jan­uary, while the man­u­fac­tur­ing in­dex rose to a nine-month high of 47.8. That’s still at a level sig­nalling con­trac­tion and the re­port also said fac­to­ries con­tin­ued to cut jobs.

On the up­side, con­fi­dence across the pri­vate sec­tor im­proved, thanks in part to a more up­beat man­u­fac­tur­ing in­dus­try. Sen­ti­ment there jumped for a fifth month on hopes that the econ­omy is past the worst of the re­cent down­turn.

On Thurs­day, Euro­pean Cen­tral Bank pres­i­dent Chris­tine La­garde of­fered a sim­i­lar view, say­ing that down­side risks to the eco­nomic out­look are ‘some­what less pro­nounced’.

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