Services sector in Europe sees strong growth
SERVICES activity in the Eurozone grew at its fastest rate since December 2007, boosted by sharp rises in both the business activity and new orders balances. The headline Markit business activity index for October came in at 52.6, beating both the flash estimate and the September reading.
The strongest expansion was seen in France, which saw the rate of growth in the services sector soar to a 20-month high. Europe’s largest economy Germany only registered a marginal increase in activity in the services sector.
Markit chief economist, Chris Williamson said: “The return to growth of service sector activity is particularly encouraging as it points to an increasingly broad-based, and therefore more sustainable, upturn in the euro area.
Unemployment remained a concern but the rate of job shedding improved modestly in October. The Markit survey showed a further marked drop in backlogs of work, suggesting that staff levels continue to exceed the numbers needed to meet current flows of new business. However, if current inflows of work continue to be sustained, then the rate of unemployment in the sector looks like moderating, Markit said.