Eurozone composite PMI hits six-month high

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The Eurozone economy hinted at early indications of recovery during January, according to Hamburg Commercial Bank and S&P Global, with growing inflationary pressures boosting the European Central Bank's case for holding interest rates steady at their current record highs.

The bloc's composite PMI increased to 47.9 in January, up from 47.6 in December and in line with initial forecasts. The services PMI dipped to 48.4 from December's 48.8, while the HCOB Eurozone manufacturing PMI rose to 46.6 the highest reading in ten months.

While the composite PMI's reading was its strongest score since July, it still fell short of the 50-point threshold separating growth from contraction.

Last month saw a quicker increase in input and output costs and, although there was a gain in the demand index, it remained well below breakeven. Output prices increased from 53.8 to 54.2, an eight-month high.

However, indicating services firms expect things to pick up, optimism about the year ahead was at an eight-month high, with firms increasing headcount at the fastest rate since September, with the employment index rising to 51.2 from 50.8.

Reporting by Iain Gilbert at Sharecast.com