The Euro edged higher against the Pound on Wednesday after a report showed that the Eurozone’s private sector had its busiest month in over two years in January as manufacturing growth outpaced a modest expansion in service activity.
Markit’s Composite Purchasing Managers Index (PMI) increased to 52.9 in January, up from the previous month’s figure of 52.1. The figure was the highest reading seen since June 2011 and was comfortably above the 50 mark which divides expansion from contraction. The report also marks the seventh consecutive month where output from the Eurozone has expanded.
The data is likely to increase optimism that the region is finally beginning to shake off the negative impacts of the debt crisis. Despite that however, unemployment across Europe remains close to record high levels and until the jobless rate begins to fall a full scale recovery cannot be said to be occurring.
“Job creation in Germany and renewed employment growth in Spain was offset by further cuts in France and Italy, albeit at slower rates. Irish employment was flat over the month,” said Markit.
A separate report showed that Eurozone service sector activity fell in the last quarter of 2013. The data showed that Services fell to 51.6 from 51.9. Despite the fall investors still saw it as a positive due to the figure remaining above the 50 mark.
Sterling weakened against the majority of its most traded peers after service sector activity in the UK expanded at its slowest pace in seven months in January. The report dented optimism regarding the outlook for the country’s economy.
Euro (EUR) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Euro,,US Dollar,1.3522 ,
Euro,,British Pound,0.8304 ,
Euro,,Australian Dollar,1.5140 ,
Euro,,Canadian Dollar,1.4961 ,