"A strengthening upturn in the manufacturing sector is helping the euro area recovery become firmly established. The latest numbers are consistent with production growing at a quarterly rate of approximately 1% at the end of the year."
- Chris Williamson, chief economist at Markit
Manufacturing activity in the Eurozone rose at its fastest pace in two and a half years in December; nevertheless, analysts are concerned that the data indicate a worrying divergence between core European economies. Manufacturing purchasing managers' index surged to 52.7 in December, up from 51.6 a month earlier, Markit said. A level above the crucial 50-point mark indicates expansion in the sector's activity. The positive data reinforce the view that the Euro bloc's recovery is gathering momentum after growth slowed in the third quarter.
The German reading reached a 30-month high of 54.3, while the PMI for Italy, the Eurozone's third-largest economy, rose to 53.3, up from 51.4, hitting the highest level since the mid of 2011. The latest manufacturing data coming from the Southern Europe also surprised to the upside. Although, Greece's reading was in the contractionary territory, it rose to 49.6, the highest level in almost four and a half years, while Spain's index rose into expansion territory, reaching a two-month high of 50.8 in December. Nevertheless, factory output in France continued to struggle and came in below analysts' expectations, with PMI falling from November's 48.4 to 47, the lowest level in seven months.
© Dukascopy Bank SA