The euro area private sector growth improved more than initially estimated in May driven by the resurgence in the services economy amid easing of the COVID-19 related restrictions, final data from IHS Markit showed on Thursday.
The final composite output index rose to 57.1 in May from 53.8 in April. The flash reading was 56.9.
Not only did May mark a third successive month of expansion, but the best recorded since February 2018, Markit said.
The upturn was driven by a noticeable acceleration of growth in services. Services activity grew at the fastest pace in just under three years in May.
The final services Purchasing Managers’ Index came in at 55.2 in May, up from 50.5 in April and the flash score of 55.1.
Among big-four economies, Germany’s growth improved slightly, but it was Italy that recorded the weakest net rise in private sector output.
Spain performed strongly, registering its best performance in fourteen-and-a-half years, whilst growth in France hit a ten-month high.
Driven by the renewed increase in services activity, Germany’s private sector growth accelerated further in May. The final composite output index improved to 56.2, as initially estimated, from 55.8 in April. Likewise, the services PMI advanced to 52.8 from 49.9 in the previous month.
France’s private sector expansion was the strongest since July 2020. The composite output index came in at 57.0, up from 51.6 in the previous month. The reading matched preliminary estimate.
Similarly, the final services PMI advanced to 56.6, as estimated, from 50.3 a month ago.
Italy’s private sector logged its fastest growth in over three years. The composite PMI advanced to 55.7 from 51.2 in April. The services index rose to 53.1, which was above the consensus of 52.5.
Spain’s private sector growth improved to its highest level since November 2006 with stronger gains in both manufacturing and service sector output. The composite output index climbed to 59.2 from 55.2 in April. The services index came in at 59.4 versus 54.6 a month ago and economists’ forecast of 58.0.
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