Strongest Growth in Eurozone Economic Activity in 15 Years

Eurozone economic activity shows its strongest growth in 15 years in June as the recovery from the corona crisis gains momentum. British market researcher Markit reported this. The growth is mainly driven by the further relaxation of the corona measures and the vaccinations against the virus.

 

As a result, things are improving in the service sector, including catering, retail and tourism.

Markit’s Purchasing Managers Index, which reflects economic activity, rose to 59.2. That is the highest level since June 2006. A reading of 50 or more indicates growth, below that, contraction. In addition, the euro area services sector index climbed to its highest level in 41 months. The growth in the industry is also at a very high level.

“The eurozone economy is growing at a rate not seen in 15 years as companies face very soaring demand. Moreover, the recovery is increasingly broad-based, moving increasingly from industry to the services sector, especially for companies that provide services to consumers,” said Markit chief economist Chris Williamson.

Markit says that companies are hiring more staff due to strong demand and that confidence in the future is at the highest level measured to date. However, the industry continues to struggle with supply chain problems, such as chip shortages, while raw material prices also rise, Markit said. As a result, prices are further pushed up. However, according to Markit, there are signs that the supply problems in Germany are weakening somewhat.

The research firm says the figures indicate that the growth of the eurozone economy in the second quarter will be “impressive” and that growth could be even stronger in the third quarter.

The United Kingdom is also doing well economically, although the British indicator weakened somewhat compared to the record level measured in May.

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