"A slight easing in the euro area´s rate of growth was seen in May but doesn‟t change the picture of a region that´s enjoying its best spell of growth for three years, especially when an acceleration in growth of new orders suggests that the pace of expansion could pick up again in June"
-Chris Williamson, Markit chief economist
It seems that the 18-nation's bloc's economy has found a solid footing in its services sector, as activity in manufacturing sector slowed further, adding more pressure on the ECB to act in June. Moreover, Thursday's reports only highlighted the growing misbalance between all members.
Europe's business signalled that the recent pick up stalled slightly in May, with the headline flash manufacturing PMI turning lower to 53.5 in May from fourth month's final reading of 54.0. Despite the disappointment, the measure remained in the expansion zone for the eleventh consecutive month, and in general, activity has been improving since late 2012, when it broke the 46-point level. The composite PMI index remained little changed at 53.9 over the observed period, coming completely in line with analysts' forecasts. A slowdown in manufacturing was offset by solid performance of the services sector, where a gauge of activity rocketed to a 35-month high. On the back of the report Markit claimed the economic output can rise 0.5% in the second quarter– the fastest since early 2011. While France continue to struggle, Germany was the main reason for the upbeat assessment. Europe's largest economy has been sending worrying signs over the last several weeks, however manufacturing PMI at 52.9 and services index at 56.4 are still pointing at the resilience of Europe's locomotive.
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