- Tim Moore, senior economist at Markit
The volume of factory orders in Europe's powerhouse jumped by the most in eight months, amid growing evidence the 17-nation's bloc is finally recovering from its longest-ever recession. German factory orders, a leading indicator of overall production, advanced 3.8% in May, when they dropped an upwardly revised 0.5%. Economists expected a gain of just 1%. On a yearly basis, orders picked up 4.3%, compared with a revised 1.8% gain recorded in May. Earlier this month, Markit Economics reported that Germany's final manufacturing PMI rose to 50.7 last month, the highest in 18 months. In addition to that, business activity in the country continued to grow in July, showing an expansion to 51.3, following June's pick-up to 50.4.
Also Tuesday, a report published by the National Institute of Statistics showed the pace of contraction in Italy slowed in Q2. Italy's gross domestic product contracted for the eighth straight quarter, shrinking 0.2% in the second quarter, after falling by 0.6% during the previous three months. Analysts, however, expected a 0.4% contraction. During the whole 2012 Italian real GDP declined 2.4%.
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