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Euro zone economy set for strong finish to 2017

Monday, November 06, 2017 - 01:47

The euro zone's economy lost some energy last month but growth remained strong and firms were able to pass on more of their costs to consumers as pricing power increased. As Sonia Legg reports, investor sentiment towards Germany also rose to an all-time high in November.

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A quiet start to a new week in Barcelona - and signs too of a slower economy in Spain. IHS Markit's survey of the key services sector was down more than two points in October to 54.6 that's the lowest level for nine months. The political crisis in Catalonia also weighed heavily on business sentiment in the sector. (SOUNDBITE) (English) WILSON KING INVESTMENT MANAGEMENT, HEAD OF RESEARCH, RICHARD HUNTER, SAYING: "The Catalan leader handing himself in marks something of an end to that particular chapter. But nonetheless one would expect in the quarterly figures there should be some sort of follow through which from a Spanish point of view hopefully can be rectified in the months ahead." Spain's manufacturing activity expanded at the fastest rate in 2 and half years in October. Made in Germany items - particularly cars and machines - were also in demand in September. (SOUNDBITE) (English) WILSON KING INVESTMENT MANAGEMENT, HEAD OF RESEARCH, RICHARD HUNTER, SAYING: "With the euro at sustainable levels and them being quite a large export country that their finances are very much in rude health and they are seen of course with Angela Merkel as being pretty much at the forefront of the European Union not only economically but politically as well." It all means the euro zone is on track for a strong finish to 2017. IHS Markit's final composite PMI for October was 56 points - well above the 50 mark that indicates growth. The private sector in France expanded at its fastest pace in 6 years. As did growth in Italy's manufacturing activity. That's something former Prime Minister Silvio Berlusconi may seize upon as he looks set for a stunning political comeback. He and his allies look set to win a regional election in Sicily, giving them a good chance of doing the same in a national election next year.

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Euro zone economy set for strong finish to 2017

Monday, November 06, 2017 - 01:47