An overview of the cafes in Leidseplein’s empty square on March 27, 2020 in Amsterdam, the Netherlands
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LONDON – Business activity in the eurozone is having a fairly solid December, according to data from the region’s latest preliminary purchasing manager index (PMI).
The PMI composite production index for the euro area, which analyzes activity in both the manufacturing and services sectors, reached 49.8 in December, compared with 45.3 in November. However, a reading below 50 indicates a contraction in business activity.
Commenting on the PMI flash data, IHS chief economist Markit Chris Williamson noted that “the eurozone economy is improving on what was expected in December.”
“The data hints at the economy nearing stabilization after falling sharply again in November amid renewed measures to block Covid-19. Therefore, the recession in the fourth quarter seems much less strong than the success of the pandemic seen earlier this year, although the picture is very mixed by sectors “.
The euro was trading at the dollar, at $ 1.22, up 0.15% from the pound sterling, driven by news that it was advancing in post-Brexit trade negotiations between the EU and the UK.
Last month’s reading was already the lowest in the index in six months and fell from 50 in October.
The eurozone economy was expected to have had another success of a new round of blockades that were imposed amid a second wave of coronavirus infections.
There were plans to relax the rules over Christmas to allow families to get together, but several governments, including Germany and the Netherlands, have tightened restrictions due to an increase in cases.
Germany introduced more restrictions on Wednesday, closing non-essential schools and businesses. This adds to the closure of restaurants, bars and entertainment venues closed since November. The German public health agency, the Robert Koch Institute, announced 27,728 new infections in the last 24 hours, bringing the total to 1,379,238. “We are forced to take action,” German Chancellor Angela Merkel said last Sunday when new restrictions were announced.
Europe has reported more than 22 million cases of coronavirus since the pandemic erupted in the region in early spring, according to World Health Organization data, and has recorded more than 493,000 deaths from the virus.