The pace of growth among businesses in the eurozone eased in
October as the service sector slowed, a survey has indicated.
From 52.2 in September, the preliminary Purchasing Managers’ Index
(PMI) from research firm Markit fell to 51.5.
Nevertheless, a reading above 50 still entails expansion, and
activity has now developed for four months straight.
Markit said expansion was “broad-based” across the eurozone,
although growth slowed in both Germany and France.
Germany had seen growth slow to a three-month low. It has been the
chief economic powerhouse for the eurozone in the past years.
Markit also noted that the eurozone’s jobs market remained weak.
Employment fell for the 22nd month in a row, with the rate of job losses
picking up from September.
“The survey data have been running in positive territory for four
consecutive months now and indicate that the eurozone economy expanded at a
quarterly rate of 0.2% at the start of the fourth quarter, suggesting an
ongoing, albeit sluggish, recovery,” said Chris Williamson, chief economist at
Markit.
Slow improvement
Spain was one of the hardest hit by the credit crunch and
subsequent economic recession. Spain’s economy has been showing signs this week
that it is bit by bit beginning to make progress.
Unemployment rate is one of the highest in Europe. Official
figures show the country’s unemployment rate fell slightly in the third quarter
of this year, to 26% from 26.3% in the previous quarter.
The Bank of Spain said On Wednesday that the country’s economy had
emerged from recession after growing for the first time in more than two years.
The bank projected that Spain’s economy raised by 0.1% between
July and September.
The eurozone came out from recession in the second quarter of this
year when it grew by 0.3% following a record 18 months of economic contraction.
On the other hand, earlier this month, European Central Bank (ECB)
president Mario Draghi said the recovery in the bloc remained “weak, fragile,
uneven”.
He said further support for the banking sector could not be ruled
out, and that the ECB was “ready to consider all available instruments” to
maintain financial stability and ensure that recovery in the eurozone took
hold.
There has been assumption that the ECB has the possible to offer
one more round of not expensive, cheap, long-term loans to banks to keep the
cost of credit down.
