empty
16.12.2021 04:45 PM
EU business growth slowing down in December due to Omicron threat

According to a survey released on Thursday, Eurozone business growth has slowed down more than expected in December due to renewed restrictions aimed at limiting the outbreak of the Omicron strain of COVID-19. New quarantine measures have limited the recovery of the bloc's dominant service industry.

Eurozone business growth slow in December due to Omicron threat

This image is no longer relevant

Europe is facing the fourth wave of the pandemic, as many governments urge their citizens to stay at home and avoid unnecessary social contacts.

IHS Markit's Flash Composite Purchasing Managers' Index, a good indicator of overall economic health, dropped in December to 53.4 from 55.4 in November, reaching the lowest level since March. An earlier Reuters poll forecasted the index to reach 54,0 points.

The services PMI slumped to an 8-month low, reaching 53,3 compared to earlier level of 55.9. Although the index did not cross the 50,0 mark separating growth from contraction, it missed the predicted 54.1 points.

"The renewed decline in the Composite PMI in December suggests growth slowed to a crawl as tighter restrictions and growing consumer caution are taking their toll on economic activity, with the service sector bearing the brunt," Michael Tran at Capital Economics commented.

Growth of demand for services has reached the lowest level since April, with the new business index falling to 52.6 from 54.2.

Earlier data indicated that the growth of the private sector in Germany has stopped, as the service sector of Europe's biggest economy got hit by new restrictions.

The new variant of COVID-19 weighed down on business activity growth in France - the second economy in the Eurozone and the only other country in the bloc to report flash data.

The disappointing news comes after the recent EU industrial output data for October, which gave optimism to investors.

Outside the euro bloc, Omicron has already hit the UK hospitality sector and travel companies, sending private sector growth down to a 10-month low.

Nevertheless, the Bank of England has announced the winding down of economic stimulus and a gradual interest rate increase.

Earlier, investor betted against a rate hike with the ongoing coronavirus wave in full swing. Wednesday's data showed that the UK CPI beat market expectations and reached a 10-month high in November.

Weakening inflation pressure

The new coronavirus restrictions have also affected factories, which are generally less affected by quarantine measures. The manufacturing PMI declined to a 10-month low of 58.0 from November's 58.4. An index measuring output that feeds into the composite PMI nudged up to 53.9 from 53.8.

Price pressure has slightly declined but remained high, in one brighter spot for the policymakers at the ECB. The input prices index eased to 87.0 from 88.9. The output prices index declined even stronger.

"Price pressures have been easing in December, albeit only cautiously. It is a cautious sign of some easing pressures coming from supply shortages, which confirms some anecdotal evidence but it's way too early to conclude that the worst is behind us," said Bert Colijn at ING.

According to an expert poll by Reuters, the ECB is set to reduce monthly asset purchases twofold every month from April 2022. The interest rate increases are likely years away.

The optimism of market players about 2022 is improving as the rapid vaccine rollout continues, with the composite future output index recovering to 66.5 from 66.1.

"Forward-looking indicators also offered a glimmer of hope. Year-ahead sentiment improved marginally in December, in part due to hopes of further easing in supply-side disruptions following some encouraging signs in December," commented Ricardo Amaro at Oxford Economics.

A slight decrease in inflation could be attributed to falling demand due to the new wave of COVID-19, as well as the traditional period of discounts during the holiday season. The industry and retail sector are expecting a boom in the run-up to the holidays.

The actual economic situation and the true extent of the losses caused by COVID-19 would be only clear after the New Year's Day.

Egor Danilov,
Experto analítico de InstaForex
© 2007-2025
Seleccione el marco de tiempo
5
min
15
min
30
min
1
hora
4
horas
1
día
1
s.
Gana con los cambios en el valor de las criptomonedas con InstaForex.
Descarga MetaTrader 4 y abre tu primera operación.
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    UNIRSE AL CONCURSO

Recommended Stories

STOXX 600 alcanza nuevas cimas: ¿hacia dónde se dirige el crecimiento y qué les espera a los inversores?

Cisco sube tras la mejora de previsiones para el ejercicio fiscal UnitedHealth cae por un informe que menciona una investigación penal El índice europeo STOXX 600 apunta a su quinta

12:47 2025-05-16 UTC+2

Trump contra el dólar: por qué a la Casa Blanca le conviene una moneda débil

Algo extraño le está ocurriendo al dólar: se debilita, pero nadie lo reconoce oficialmente como una debilidad. El Departamento del Tesoro repite su mantra sobre una "moneda fuerte", Trump guarda

Аlena Ivannitskaya 13:23 2025-05-15 UTC+2

El Bitcoin y altcoins al alza, gracias a los datos de inflación y la tregua temporal entre EE. UU. y China

El miércoles 14 de mayo de 2025, el mercado de criptomonedas respiró aliviado tras la publicación de unos datos de inflación más moderados en EE. UU. de lo que esperaban

Natalia Andreeva 13:33 2025-05-14 UTC+2

NRG Energy despega tras un acuerdo de $12 mil millones — ¿nuevos actores en el sector energético?

Índices al alza: Dow +2,81%, S&P 500 +3,26%, Nasdaq +4,35%, Las acciones superan a los activos refugio por distensión comercial Apple sube ante posibles aumentos de precios en iPhone Índice

12:10 2025-05-13 UTC+2

El Bitcoin en picado: primero conquista la cima, luego retrocede. Beneficio del acuerdo entre China y EE.UU.

El lunes 12 de mayo, el precio del Bitcoin superó los $104 000, alcanzando un pico de $105 000. Sin embargo, posteriormente la primera criptomoneda experimentó una caída. Además

Larisa Kolesnikova 11:09 2025-05-13 UTC+2

El oro está de capa caída: ¡sus precios han bajado! Contraataque del dólar y retirada del euro

A comienzos de esta semana, el metal amarillo cedió parte de sus posiciones, reaccionando al contexto geopolítico. Aun así, la demanda de oro se mantiene moderadamente alta, lo que permite

Larisa Kolesnikova 09:05 2025-05-12 UTC+2

Trump promete acuerdos ya esta semana: ¿en qué se traducirá esto para el dólar?

Durante el fin de semana, Trump insinuó posibles acuerdos comerciales ya esta semana. Como de costumbre, no hubo detalles concretos, pero las consecuencias no se hicieron esperar. El lunes

Аlena Ivannitskaya 08:28 2025-05-05 UTC+2

El Bitcoin presta atención a la opinión de la Fed. El ciclo actual del BTC no se parece a los anteriores

Según observaciones de analistas, el ciclo actual del Bitcoin es diferente a los anteriores. Los expertos atribuyen esto no solo a la volatilidad actual de la primera criptomoneda

Larisa Kolesnikova 14:18 2025-04-21 UTC+2

¿Sobrevivirá el índice S&P 500 bajo la "cruz de la muerte"?

Al amplio índice S&P 500 (SPX) le resulta cada vez más difícil mantenerse a flote. La volatilidad del mercado, que se dispara debido a la inestable situación geopolítica

Larisa Kolesnikova 08:14 2025-04-16 UTC+2

El mercado en zona roja: Dow -0,4%, Nasdaq -0,1% — los buenos informes no salvaron a Wall Street

Bank of America sube tras una mayor ganancia en el primer trimestre La incertidumbre sobre las perspectivas arancelarias sigue siendo alta Los mercados fluctúan por disputas entre

08:14 2025-04-16 UTC+2
¿No puede hablar ahora mismo?
Ingrese su pregunta en el chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.