Euro zone downturn eases slightly in November: surveys

Wed Dec 5, 2012 7:53am EST
 

By Andy Bruce

LONDON (Reuters) - The euro zone's economic slump was a little less pronounced in November than previously thought, although there are few signs the region will emerge from recession any time soon, business surveys showed on Wednesday.

Markit's Euro zone Composite PMI, which gauges business activity across thousands of companies, rose in November to 46.5 from 45.7 in October - markedly higher than the preliminary reading of 45.8 reported 10 days ago.

But the PMI has lingered below the 50 mark that divides growth and contraction for all but one of the last 15 months and with no economic stimulus in the pipeline, there is little reason to expect a rebound.

Survey compiler Markit said there was no single reason for the upward revision to the PMI from the mid-month flash estimate, which could simply be down to a stronger end to the month for businesses.

France, Spain and Italy were the biggest drags on the euro zone economy through last month. Germany performed better.

Overall, however, the survey still pointed to a deepening recession this quarter, following the economy's 0.1 percent decline in the third quarter.

"The (upward revision) is good news as it might be a sign that activity has bottomed out in Q3," said Annalisa Piazza, economist at Newedge Strategy in London.

"Nevertheless, we see no signs of improvement that suggest that the EMU economy might recover any time soon. Further contraction in GDP remains our baseline scenario at least until Q1 2013."   Continued...

 
People wait in line to enter a government job centre in Malaga, southern Spain April 29, 2011. REUTERS/Jon Nazca