- Yves Mersch, ECB Executive Board member
While German activity in the manufacturing sector unexpectedly rose in October, France continues to experience a decline in the corresponding gauge. The flash manufacturing PMI came in at 47.3, down from 48.8 in September and further below the 50-mark threshold, which separates expansion and contraction. The recent report of the Bank of France showed the sentiment indicator in the manufacturing sector declined to 96 in September from 97 a month earlier. On top of that, business activity in the nation's services sector also stayed in the contraction territory, with the corresponding reading falling to 48.1, down from 48.4 seen in September. In Germany, however, Markit's preliminary PMI for manufacturing sector surprisingly rose to the green zone, reaching 51.8 in October, up from September's 49.9. Business activity in the service sector waned somewhat, with the respective reading sliding to 54.8 in the reported month. Another big surprise on Thursday became unemployment data from Spain, as the nation's jobless rate decline in the third quarter to 23.7%, down from 24.5% in the prior three-month period. Nevertheless, Spain's unemployment rate still remains at unhealthy high level.
The European economy is still in the danger zone, ECB official Yves Mersch said, urging further financial integration in form of a capital markets union to remove remaining hurdles to growth.
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