Berlin - Germany’s economic output picked up this month and companies reported that new business rose at the fastest pace in two years.
The latest purchasing managers’ report from Markit Economics points to an improving picture in the euro-area’s largest economy, with a composite index of activity rising to 54.9, the highest since August, from 54.2. A measure of new business also increased.
The services index reached its strongest reading since September 2014 and a gauge of manufacturing also advanced. Both defied economists’ forecasts for slight declines.
While a slowdown in emerging markets from China to Brazil is weighing on the country’s export-oriented manufacturing sector, record-low unemployment, low interest rates and a weak euro are providing support. The Bundesbank said last month that the growth trend remains strong and European Central Bank president Mario Draghi has left the door open to more stimulus for the euro region in December.
“The rise in new business was a particularly bright spot,” said Oliver Kolodseike, an economist at Markit. “PMI data available for the fourth quarter so far point to further modest, albeit unspectacular growth, of the German economy.”
Economic growth slowed in the third quarter, along with an unexpected cooling of the euro area as a whole. Nevertheless, investor confidence rose in November for the first time in eight months.
In France, the composite index slipped to 51.3 from 52.6, Markit said. Services growth cooled, with hotels and restaurants reporting a negative impact from the terrorist attacks in Paris.
In the euro area, the combined measure probably rose to 54 in November from 53.9 in October, according to a survey of economists by Bloomberg News. Markit will publish the readings for the 19-nation region at 9 a.m. London time.
-With assistance from Ainhoa Goyeneche and Harumi Ichikura in London.
BLOOMBERG