Eurozone PMI index shows first growth for 18 months

Private business across the eurozone returned to growth in July for the first time in 18 months, a key survey indicated on Wednesday, possibly signalling an end to recession. The Markit Eurozone Composite Purchasing Managers Index logged 50.4 points, above the 50-mark signalling growth, and a bigger-than-expected rise according to analysts after posting 48.7 points in June. The survey, which had been in negative territory since February 2012, is closely watched as a leading indicator of activity, and economists said cautiously that this could be a sign that recession was on the wane. The fourth monthly rise in a row overall was also marked by a two-year high logged in the manufacturing sector, which recorded 50.1 points, up from 48.8. The rate of job losses eased, Markit said, while the feedback from star economy Germany showed rising output there at a five-month high. Taken together, the data provides a "summer filip to policymakers," in the words of Markit chief economist Chris Williamson. He added: "The best PMI reading for one-and-a-half years provides encouraging evidence to suggest that the euro area could -- at long last -- pull out of its recession in the third quarter." While manufacturing led the revival, Williamson also highlighted "promising signs of stabilisation in the service sector, which hints at some much-needed upturns in domestic demand." Services logged 49.6 points, up from 48.3. While cautioning that there have been "false dawns" before, Ben May of London-based Capital Economics said the eurozone economy appeared to be "on the mend and might perhaps soon exit recession."