Euro-area economic growth accelerated to its fastest pace this year as growing order books prompted companies to add more workers and raise prices.
A Purchasing Managers’ Index for manufacturing and services rose to 54.1 in November from 53.3 a month earlier, IHS Markit said on Wednesday. That’s the strongest level in 11 months and above the 50 mark that divides expansion from contraction.
The signs that recovery is gathering momentum should give some relief to the European Central Bank as it faces a complex decision on 8 December whether to extend its €1.7 trillion quantitative-easing program. President Mario Draghi said this week that the recovery remains reliant on continued monetary support.
Germany continued to be a growth driver among euro-area economies and France was enjoying its best expansionary spell since the start of the year, according to Markit.
The euro-area manufacturing PMI jumped to 53.7 in November, a 34-month high, while a gauge for services rose to 54.1.
IHS Markit said that companies are taking on staff at the joint-fastest pace since early 2008. Average prices charged for goods and services showed the biggest rise for more than five years as companies passed on higher input costs to customers.
“The preliminary PMI results for November indicate the sharpest monthly increase in business activity so far this year, with plenty of signs that growth will continue to accelerate,” said Chris Williamson, chief business economist at IHS Markit. “ECB policy makers will also be pleased to see inflationary pressures are intensifying steadily.”
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