Manufacturers hired staff at the fastest rate in almost eight years in March, according to the latest numbers from Markit. The survey showed manufacturing companies edged up slightly to 54.3 from 54.2 the previous month.
A weaker euro helped boost exports and orders, fuelling steady growth in the sector. It’s the 16th month in a row the figures have held above the 50 mark that denotes growth.
Justin Urquhart Stewart, Seven Investment Management, says, “Not only are they above the 50 limit but they’ve been growing above the 50 level. One off data ignore but follow the line of direction and this is an encouraging sign.”
There was more good news for manufacturers across the euro zone.
Overall activity rose to a 10-month high of 52.2, beating expectations and staying above 50 for 21 months.
Further signs of a euro zone revival after last year’s slowdown.
Not surprisingly, Germany’s economy is growing. Its manufacturing sector grew at its fastest rate for almost a year.
And even France’s troubled economy showed a small improvement.
But could the positive data lead the ECB to rein back the pace of bond buying earlier than expected?
Best not, says Urquhart Stewart.
“All of these central bankers know full well if they take too precipitous action and are seen to destroy the confidence level then the economies will go straight back again into recession.”
The good news didn’t spread to Greece, where exports slowed for the seventh month in a row.
On a brighter note, employment in the sector did rise slightly thanks to new jobs created in consumer goods firms.
But with Greece yet to conclude negotiations with its euro zone partners and the IMF on reforms still needed to secure the remaining bailout aid, concerns over its economy and a possible “Grexit” still remain.