Euro area economic activity cools slightly in July, PMIs show

Economic growth in the Eurozone cooled a tad last month but nevertheless continued to grow at near its fastest pace in six years, the results of a widely-followed survey showed.

IHS Markit's composite euro area output index retreated from a reading of 56.3 for June to 55.7 for July, slightly undershooting a preliminary reading of 55.8.

However, the gauge, which reflects activity levels in both the manufacturing and services sector continued to be near its best levels of the past six years, IHS Markit said.

The pace of expansion was again broad-based in July, both as regards the breadth across countries and sectors, IHS said, with the strongest rates seen in Ireland and Spain.

However, it was only in Italy that composite activity actually accelerated from one month to the next.

Chris Williamson, Chief Business Economist at IHS Markit, said: "The surveys indicated a slight cooling in the pace of growth in July, but this is still anencouragingly upbeat picture of business conditions. The elevated PMI reading puts the eurozone economy on course for another strong quarter, the data being historically consistent with a very respectable 0.6% quarter-on-quarter increase in GDP."