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- Eurozone services sector drives further acceleration in growth during May
Eurozone services sector drives further acceleration in growth during May
According to the report from IHS Markit, a resurgent services economy helped to drive private sector growth higher during May. After accounting for seasonal factors, the Eurozone PMI Composite Output Index recorded 57.1, up from 53.8 in April. Not only did May mark a third successive month of expansion, but the best recorded since February 2018.
The upturn in the index was driven in the main by a noticeable acceleration of growth in services activity. May’s data indicated a second successive monthly rise in service sector output, and the best recorded for nearly three years. Nonetheless, despite seeing the slowest growth for three months, manufacturing output continued to a rise at a sharper rate than services activity.
Thanks to continued strength in demand for manufactured goods and a noticeable improvement in services new business, private sector new work rose to the strongest degree since June 2006.
Sales growth was also broad-based by demand source, with gains recorded in both domestic and international markets. New export business rose for a sixth successive month, with the net increase the sharpest since composite data were first available in September 2014.
Confidence in the outlook also improved during May, hitting its highest level since comparable data were first available in mid-2012. That was despite signs of continued cost pressures. Input prices overall increased to the sharpest degree in over a decade. Efforts to pass on higher input costs to clients in the form of increased output prices meant that output prices rose at the strongest rate in the series history.
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