New PMI data suggest that divergences in Europe are widening: the UK and Germany reported robust expansion in business activity, while the news on output from Italy and France was more gloomy.

US private sector job creation picked up by the most in a year in November, while in Australia, weaker consumer spending held back growth in the third quarter.


UK: The services sector performed strongly in November; the CIPS/Markit services PMI recorded a level of 60. The results are evidence of continuing strong output growth in the sector, down 2.5 points from the 16-year high recorded in October.

Activity and new business continued to rise and service providers expanded capacity by hiring new staff.

In good news for Christmas shoppers, the British Retail Consortium reported the seventh consecutive month of shop price deflation. Prices dropped 0.3 per cent in November, after a 0.5 per cent decline in October.

Eurozone: GDP rose 0.1 per cent in the eurozone by 0.2 per cent in the EU during the third quarter, compared with the previous quarter, according to second estimates by Eurostat. In the second quarter of 2013, growth rates were 0.3 per cent and 0.4 per cent respectively. Compared with the same quarter of the previous year, seasonally adjusted GDP fell 0.4 per cent in the euro area and rose 0.1 per cent in the EU28 in the third quarter of 2013.

Markit’s eurozone Composite PMI: Overall output for the eurozone was at 51.7 in November, down from 51.9 the month before.

Germany: The eurozone’s performance was mainly led by strong German PMI results of 55.4 in the composite index, boosted by the fast rate of new business growth since June 2011. Services PMI growth was higher at 55.7. Employment rose strongly and business optimism about outlook for the year ahead was the highest since March.

Ireland: Ireland joined Germany in leading the eurozone pack with Investec Services reporting a composite PMI of 57.1, a moderate decline from figures earlier this year. Ireland also posted further strong job creation figures.

Spain: Spain reported an unexpected expansion in services PMI of 51.5, the first increase since August. The figures follow news that the country emerged from its two-year recession in Q3.

France: By contrast France lost further output momentum, with PMI at 48.0 – a five-month low. This raises the prospect of a return to recession in Q3. The country also reported reductions to payroll numbers and new business activity for November.

Italy: Italy had similarly gloomy news, the Markit/ADACI Services PMI contracting after two consecutive months of growth. The index dropped to 47.2 in November from 50.5 the month before. A sharp drop in employment was also recorded – the worst since August.

Switzerland: The Federal Statistics Office reported that Swiss industrial production rose 0.7 per cent in the third quarter compared with the same quarter in 2012. Turnover rose 0.8 per cent. Orders received decreased 2.3 per cent and orders on hand fell 0.2 per cent.

Czech Republic: Latest figures from the Czech Statistical Office show a smaller GDP contraction than originally forecast for the Czech Republic. GDP was down 0.1 per cent in Q3 compared to the previous quarter. Forecasts are for an overall GDP contraction of 1.3 per cent for 2013.

Average gross monthly wages grew by 1.3 per cent compared to the same period last year. In real terms, this was a rise of 0.1 per cent.

Hungary: GDP figures from Hungary’s Central Bank show annual growth of 1.8 per cent in 2013. Growth in Q3 was 0.9 per cent higher than the previous quarter, with agriculture production volumes up 27.6 per cent and construction up 7.3 per cent.

The volume of retail sales rose 2.5 per cent in October, primarily driven by non-food retail trade and automotive fuel trading.


US: The ADP National Employment Report indicated 215,000 jobs were created last month, on a seasonally adjusted basis, following an upwardly revised 184,000 rise in October. November’s private payrolls growth reflected the strongest employment gain since a jump of 276,000 jobs in the same month last year. A Bloomberg survey of economists had expected an increase of 185,000.

Brazil: The statistics institute published figures for October showing a 0.6 per cent expansion in national industrial output over the previous month. In the cumulative index in the first 10 months of this year, industrial activity rose 1.6% over the same period last year.

Adjusted for seasonal factors, the HSBC Composite Output Index for Brazil dropped slightly from last month’s eight-month high of 52.0 to 51.8 in November. This indicated a moderate improvement in business conditions, most notably in the hotels and restaurants sector.

Mexico: The National Institute for Geography and Statistics (INEGI) and the Bank of Mexico published data showing a monthly decline in consumer confidence of 1.48 per cent, seasonally adjusted.


Australia: Australian growth figures for Q3 were slightly lower than expected, with GDP up 0.6 per cent. The results were mainly attributed to weaker consumer spending. Annual growth in GDP slowed from 2.4 per cent to 2.3 per cent. Mining investment continues to fall from its peak last year.

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