Currencies

Dollar rises as markets turn eyes to Opec

European bourses are mirroring a tentative Asia session as the dollar continues to be supported by better US economic data and investors turn their attention to a meeting between Opec members. Sentiment is underpinned by US index futures suggesting the S&P 500 will gain 3 points to 2,207.3 when trading gets under way later in […]

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Banks

Basel Committe fail to sign off on latest bank reform measures

Banking regulators have failed to sign off the latest package of global industry reforms, leaving a question mark hanging over bankers who complain they have faced endlessly evolving regulation since the financial crisis. Policymakers had hoped to agree the contentious new measures at a crunch meeting held in Chile this week, but a senior official […]

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Banks, Financial

Banking app targets millennials who want help budgeting

Graduate debt, rent and high living costs have made it hard for millennials to save for a house, a pension or even a holiday. For Ollie Purdue, a 23-year-old law graduate, this was reason enough to launch Loot, a banking app targeted at tech-dependent 20-somethings who want help to manage their money and avoid falling […]

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Economy

Eurozone inflation climbs to highest since April 2014

A welcome dose of good news before next week’s big European Central Bank meeting. Year on year inflation in the eurozone has climbed to its best rate since April 2014 this month, accelerating to 0.6 per cent from 0.5 per cent on the back of the rising cost of services and the fading effect of […]

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Financial

Wealth manager Brewin Dolphin hit by restructuring costs

Profits at wealth manager Brewin Dolphin were hit by restructuring costs as the company continued to shift its focus towards portfolio management. The FTSE 250 company reported pre-tax profits of £50.1m in the year to September 30, down 17.9 per cent from £61m the previous year. Finance director Andrew Westenberger said its 2015 figure was […]

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Categorized | Economy

Eurozone private sector rides to 2016 high – IHS Markit


Posted on November 23, 2016

No Trump-induced slump in the eurozone.

Businesses in the single currency area reported their best levels of activity of the year in November, driven by healthy growth in the services sector, according to an influential business survey.

“The pace of economic growth in the eurozone accelerated to the fastest so far this year in November”, said IHS Markit’s latest purchasing managers’ survey, which is a good indicator for official economic growth.

Markit’s composite gauge for the private sector climbed to 54.1 in November from 53.3 – an 11-month high, with the dominant service sector companies also enjoying their best month of the year to date. Any number above 50 indicates expansion.

Growth in the single currency area’s manufacturing sector slowed slightly but still enjoyed its second best month of the year, with the manufacturing PMI registering 54.1.

November’s figures suggest the eurozone has shrugged off any lingering side-effects from the UK’s Brexit vote in July or the election of Donald Trump earlier this month.

There are “plenty of signs that growth will continue to accelerate”, said Chris Williamson at IHS Markit, which compiles the flash estimate based on 85 per cent of replies to the survey.

He now expects the eurozone to grow by 0.4 per cent in the final quarter of the year, an acceleration from the third quarter’s 0.3 per cent.

The encouraging numbers come after Germany – the bloc’s largest economy – also reported a better than expected month for its service sector companies, driven by rising employment levels.

In good news for the European Central Bank, businesses also reported higher input costs for their goods this month, pointing to a pick up in overall inflation.

“Average prices charged for good and services showed the biggest rise for over five years, albeit with the rate of increase being very modest,” said Mr Williamson.

The ECB is widely expected to extend its unprecedented stimulus measures by six months at its December 8 meeting, as the eurozone economy faces still sluggish inflation more than 18 months into the QE programme.

“The ECB hasn’t given the all-clear sign on the recovery either, with Draghi stating that the expansion is still highly reliant on monetary policy stimulus”, said James Knightley at ING.

Chart courtesy of Bloomberg