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- Eurozone private sector growth remains subdued during May
Eurozone private sector growth remains subdued during May
According to the report from IHS Markit, May saw the continued expansion of the euro area private sector, albeit at a modest pace.
After accounting for seasonal factors, the IHS Markit Eurozone PMI Composite Output Index rose to 51.8 in May, up from April’s 51.5 and slightly better than the earlier flash reading (51.6). The latest index reading was the highest for three months, and extended the current period of continuous growth to just under six years.
In line with the recent trend, it was the service sector that provided the impetus to overall growth during May, expanding at a solid pace. In contrast, manufacturing output fell for a fourth successive month, albeit at the slowest pace since February.
Modest growth of the private sector economy occurred at a time when levels of incoming new business were rising only slightly for the third month running. With activity increasing solidly, firms were subsequently able to reduce their overall backlogs of work for a third consecutive month. Companies were also able to keep on top of their workloads thanks to the continued expansion of the private sector workforce. May’s survey indicated a solid rise in staffing levels, albeit a slower pace than in April.
Finally, business confidence, undermined by ongoing worries over Brexit, US-China trade and European political instability, fell in May to its lowest level since the start of the year.
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