Eurozone manufacturers boosted their output in October at a faster pace than previously estimated, a business survey showed on Tuesday, with Spain and Ireland both recovering while Greece continued to struggle. The Markit Eurozone Manufacturing Purchasing Managers Index (PMI) rose to 54.6 in October, revised up from the earlier estimate of 54.1 and comfortably higher than the final reading of 53.7 for September.
-- Factory jobs growth hits highest since March 2008
-- German strength again offset weaker bloc members
The survey showed factories across the currency area hired staff at the quickest rate since March 2008 last month. But worryingly for policymakers, there was still a growing divergence among member states' recovery rates. Germany once again led the upturn, with growth accelerating, and while Spain saw a return to positive territory France's factory upswing moderated as output slowed to a 14-month low.
Greek manufacturing stayed firmly in the grip of recession, with the pace of contraction accelerating as output, jobs and new orders fell but Ireland saw a modest return to growth. Financial markets were little moved by the numbers. "It is welcome news to see eurozone manufacturing picking up in October and the sector looks like it can make a decent contribution to GDP growth in the fourth quarter," said Howard Archer at IHS Global Insight.
While still firmly above the 50 mark that divides growth from contraction, the headline reading is still some way off April's post-recession high of 57.6. Manufacturers reported improved output last month and they took on staff at the fastest rate in around 2-1/2 years, the survey of about 2,000 companies showed. But eurozone unemployment is still running at more than 10 percent and any optimism over manufacturing may also be tempered by surveys on the services sector on Thursday, expected to confirm a picture of slowing growth. The manufacturing output sub-index saw a strong upward revision to 54.7 from the flash reading of 53.8, up from September's final number of 54.0. The jobs sub-index rose to 52.2 from 51.5 in September.
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