MNI: Eurozone Growth Steady In April, Below Highs: IHS Markit

--Eurozone Flash Apr Composite PMI At 55.2 (55.2 in March) 

by Jai Lakhani

     LONDON (MNI) - Eurozone output grew in April at its joint-weakest since the

start of 2017, flash data released Monday showed. However, it remained well

above the average of 53.8 seen over the past five years. 

     According to the survey by IHS Markit, the Composite PMI was 55.2 in April,

unchanged from March. Both Germany and France showed a slight pick up in growth,

although not enough to recover February's levels. This was made clear by

France's expansion being the second-weakest in the past eight months with

Germany faring little better exhibiting the second-weakest growth in nine

months. 

     The same story of manufacturing dragging in France and services lagging

behind in Germany was the case in April. Compounding this was growth elsewhere

slowed to an 18-month low, where both manufacturing and services languished to

an 18-month low.   

     Both manufacturing and services saw new order inflows wane and despite

manufacturing again leading the upturn, the rate of factory output growth slowed

to a 17-month low. Services rose at a rate slightly faster than March's

seven-month low. 

     Goods exports furthered the unflattering theme with factories reporting the

smallest gains in both total goods orders and export orders for a

year-and-a-half during April. Export orders exhibited weak growth in part due to

recent strength against the Euro, notably against the U.S. dollar.     

     --SOLIDIFYING BELOW JANUARY HIGH 

     "The Eurozone economy remained stuck in a lower gear in April, with

business activity expanding at a rate unchanged in March, which had in turn been

the slowest since the start of 2017. Growth has downshifted markedly since the

peak at the start of the year, but importantly still remains robust" said Chris

Williamson, chief business economist at survey compiler IHS Markit. 

     "The decline in the PMI from January's high is neither surprising or

alarming: such strong growth seen at the start of the year rarely persists for

long, not least because supply fails to keep up with demand. with recent months

seeing record delivery delays for inputs to factories and growing skills

shortages, output is clearly being constrained," he added.

     "However it's also clear that underlying demand has weakened, in part due

to exports being hit by the stronger euro. With companies' future optimism

having slipped to the lowest since last year, it looks likely that growth may

well slow further in coming months," Williamson said.

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

--MNI London Bureau; +44 203 865 3828; email: jai.lakhani@marketnews.com

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