Eurozone Business Growth Rebounds in July

Business activity in the eurozone returned to growth in July for the first time in four months, according to S&P Global's flash Purchasing Managers' Index (PMI), as new orders improved despite persistent inflation and renewed conflict in the Middle East.

The composite PMI rose to 51.9 in July from 50.0 in June, its highest reading in five months. A reading above 50 indicates growth in business activity.

Both the services and manufacturing sectors contributed to the expansion. Activity in the services sector returned above the 50 threshold after three months of contraction, while manufacturing output posted its strongest growth in more than four years.

Germany, the eurozone's largest economy, returned to growth for the first time in four months. France remained in contraction, although the pace of its decline eased.

Chris Williamson, chief business economist at S&P Global Market Intelligence, said the data suggest the eurozone economy could expand by around 0.3% in the third quarter.

He added that growth in input costs and selling prices had also slowed, potentially easing pressure on the European Central Bank.

(Reuters, lud)