Investing.com – Manufacturing activity in the euro zone rose unexpectedly in December, climbing to a two-month high, preliminary data showed on Thursday.
In a report, market research group Markit said that its preliminary manufacturing purchasing managers’ index rose by 0.5 points to a seasonally adjusted 46.9 in December, up from 46.4 in November.
Analysts had expected the index to decline by 0.3 points to 46.1 in December.
On the index, a reading above 50.0 indicates industry expansion, below indicates contraction.
The report showed that service sector activity in the euro zone improved to a three-month high in December.
The preliminary services purchasing managers’ index rose by 0.8 points to a seasonally adjusted 48.3, up from 47.5 in November. Analysts had expected the index to ease down by 0.4 points to 47.1.
Germany saw modest growth of output, reversing the decline seen in November. The rate of contraction in France slowed to a marginal pace. Both countries saw manufacturing output continue to fall, albeit at reduced rates.
Elsewhere in the euro zone activity fell sharply, declining at a rate only marginally weaker than November’s two-and-a-half year record.
Commenting on the report, Chris Williamson, Chief Economist at Markit said, “A slight easing in the rate of contraction for the second month in a row in December provides some hope that the rate of decline may weaken further as we move into the new year.”
He added that, “The euro zone suffered its worst quarter for two and a half years in the final three months of 2011, with the PMI data suggesting that the region’s economy is likely to have contracted by 0.6%.”
Following the release of the data, the euro remained higher against the U.S. dollar, with EUR/USD gaining 0.1% to trade at 1.2997.
Meanwhile, European stock markets came off their earlier highs. The EURO STOXX 50 climbed 0.65%, France’s CAC 40 rose 0.7%, the FTSE 100 added 0.35%, while Germany's DAX advanced 0.85%.
In a report, market research group Markit said that its preliminary manufacturing purchasing managers’ index rose by 0.5 points to a seasonally adjusted 46.9 in December, up from 46.4 in November.
Analysts had expected the index to decline by 0.3 points to 46.1 in December.
On the index, a reading above 50.0 indicates industry expansion, below indicates contraction.
The report showed that service sector activity in the euro zone improved to a three-month high in December.
The preliminary services purchasing managers’ index rose by 0.8 points to a seasonally adjusted 48.3, up from 47.5 in November. Analysts had expected the index to ease down by 0.4 points to 47.1.
Germany saw modest growth of output, reversing the decline seen in November. The rate of contraction in France slowed to a marginal pace. Both countries saw manufacturing output continue to fall, albeit at reduced rates.
Elsewhere in the euro zone activity fell sharply, declining at a rate only marginally weaker than November’s two-and-a-half year record.
Commenting on the report, Chris Williamson, Chief Economist at Markit said, “A slight easing in the rate of contraction for the second month in a row in December provides some hope that the rate of decline may weaken further as we move into the new year.”
He added that, “The euro zone suffered its worst quarter for two and a half years in the final three months of 2011, with the PMI data suggesting that the region’s economy is likely to have contracted by 0.6%.”
Following the release of the data, the euro remained higher against the U.S. dollar, with EUR/USD gaining 0.1% to trade at 1.2997.
Meanwhile, European stock markets came off their earlier highs. The EURO STOXX 50 climbed 0.65%, France’s CAC 40 rose 0.7%, the FTSE 100 added 0.35%, while Germany's DAX advanced 0.85%.