The eurozone economy remained sluggish in February, with Germany showing signs of recovery and France seeing a sharp decline, according to Ed Frankl of The Wall Street Journal. He writes:
The eurozone economy continued to flatline in February, torn between signs of revival in Germany and a sharp decline in France, according to business surveys released Friday.
The euro area’s composite purchasing managers’ index–which gauges activity among manufacturing and services companies in Europe’s largest economy–held at 50.2, the same as in January, a survey compiled by Hamburg Commercial Bank and S&P Global said Friday. That was a little weaker than economists’ expectations of 50.5, from a poll by The Wall Street Journal. […]
Germany, Europe’s largest economy, had its second straight year of contraction in 2024, but is showing signs of recovery in the early part of this year, ahead of a national election on Sunday. Investor confidence ticked higher this month in the hopes that the new government might be more capable of policy action to solve the country’s economic slowdown, after the incumbent coalition fell apart over disagreements on fiscal policy.
But in Germany’s neighbor, France, activity sank to a 17-month low, according to the PMI data. […]
The PMI survey’s measure for manufacturing trails the services sector, a likely result of continued geopolitical and trade uncertainty, while also factoring in a persistent recession in the sector. High energy costs and competition from China has meant industrial production is around 10% lower than its prepandemic level. […]
However, Europe’s stagnation contrasts with signs of an acceleration in growth elsewhere. Similar surveys of businesses pointed to a pickup in activity in India, Japan and Australia during the first weeks of February.
Read more here.
