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21 February 2018
 |
Spain daily life (The Total Investment & Insurance Solutions)
There are signs that the turmoil in financial markets at the start of
February had a negative impact — albeit a short-term one — on the fast-growing
19-country eurozone economy. The Total
Investment & Insurance Solutions
A closely monitored survey of the private
sector found activity cooling during the month but still remaining near levels
not seen since before the global financial crisis over a decade ago. The Total Investment & Insurance
Solutions
In its monthly survey, financial information
firm IHS Markit found that its main gauge of business activity across manufacturing
and services — the so-called purchasing managers' index — slipped to 57.5
points in February from the previous month's 12-year high of 58.8.
The survey, which informs the European
Central Bank's thinking when it comes to setting policy, has been one of the
main indicators showing the strengthening recovery across the countries using
the euro currency. Anything above 50 indicates growth. The Total Investment & Insurance Solutions
The decline is not causing much alarm, not
least because the start of February was marked by a massive retreat in global
stock markets as investors around the world, particularly in the United States,
took fright at the prospect of rapid rises in interest rates. Markets have
since steadied, a development that's likely to ease concerns in business of a
more protracted and debilitating drop.
"The abrupt end of the long period of
nonchalance on the financial markets appears to have also put a damper on the
euphoric mood in the eurozone economy," said Christoph Weil, senior
economist at Commerzbank. "But today's data do not signal an end to the
economic upswing in the eurozone."
In fact, the eurozone is enjoying
particularly robust and broad-based economic growth that is raising speculation
that the European Central Bank will start to unwind its crisis-era measures
faster than expected.
Chris Williamson, IHS Markit's chief business
economist, thinks the region could be headed for quarterly growth of 0.9
percent in the first three months of the year, which would equate to annualized
growth — the preferred measure in the United States — not far short of 4
percent. That's a strong level and would likely prompt further big declines in
the region's still-high unemployment rates. In the last three months of 2017,
the eurozone economy grew by a healthy quarterly rate of 0.6 percent.
"The rate of expansion remains
impressive, putting the region on course for its best quarter for almost 12
years," he said.The Total
Investment & Insurance Solutions
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