Booming Euro-Area Factories Expand at Fastest Pace Since 2000
(Bloomberg) -- Euro-area factories haven’t done this well since the height of the dot-com boom 17 years ago.
A Purchasing Managers’ Index for manufacturing rose to 60.1 in November from 58.5 the previous month, IHS Markit said on Friday. That beats a preliminary reading of 60 and is the second-highest reading since the survey began in June 1997.
The currency bloc’s strongest expansion in a decade is pushing unemployment down and boosting business confidence. The upswing is being supported by the European Central Bank, which has pledged to continue bond-buying until at least September next year and keep interest rates low for a long time after that.
“The buoyant November data looks likely to add to the global dominance of euro-area manufacturing seen so far this year,” said Chris Williamson, Chief Business Economist at IHS Markit. Eurozone manufacturers are gaining “an increased share of global trade as exports boom.”
All the countries surveyed, including Greece, have recorded growing factory output for half a year now, amid strong order inflows that are prompting staff expansions and stretching suppliers.
In a sign that the boom may soon transform into inflation as predicted by ECB policy makers, price pressures are at their highest for more than six years, IHS Markit said. Even so, official euro-area data on Thursday showed inflation accelerated less than expected in November to 1.5 percent.
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