A major survey of euro zone manufacturers showed today the contraction gripping the sector eased a little in December, in line with expectations that the economic downturn may be losing momentum.
The Reuters Eurozone Purchasing Managers Index remained well below the critical 50 line that divides growth from contraction but edged up for the second month running to 44.1 in December from 43.6 in November and a series low of 42.9 in October.
NTC Research, which compiles the survey of 2,500 companies for Reuters, sounded a note of caution against reading too much into the data as the sector shrank for the ninth month running.
Although the PMI has risen over the past two months, the level of contraction signalled through the final quarter of 2001 is still considerably deeper than that seen in quarter three and quarter two, NTC said.
But the headline number was close to the consensus forecast of 44.2 and the survey is likely to reinforce market belief, spurred by a sharp rebound last month in the US manufacturing index, that global economic recovery is not far off.
Industry led the way into the past year's economic gloom and attention will now focus on the US manufacturing index, due at 3 p.m. today and expected to rise to 45.5 from 44.5 in November.
The US survey is produced by the Institute for Supply Management, formerly known as the National Association of Purchasing Management.