Euro zone downturn slows significantly in June, spurring hopes of an economic recovery

Europe News

2020-06-23 08:14:27

Amsterdam’s canals empty and deserted during the government imposed quarantine due to the coronavirus pandemic.

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The downturn in the euro zone continued to recover in June, according to data Tuesday, giving the latest indication of the region’s economic health as it emerges from the coronavirus pandemic.

Flash purchasing manager’s index (PMI) data — measuring activity in both the services and manufacturing sector in the euro zone — came in at 47.5 in June, up from a final reading of 31.9 in May. The 50-point mark separates contraction from expansion. Economists polled by Reuters had expected the flash June PMI to come in at 42.4.

The data gives markets another indication of the extent to which euro zone countries are recovering from lockdowns across the region that effectively saw whole industries shut down.  

Business activity in the single currency area had hit a three-month high in May, with the final composite PMI (which includes both manufacturing and services) coming in at 31.9, up from 13.6 in April.

The data Tuesday will build on other indications of the region’s economic wellbeing, or not. On Monday, flash consumer confidence data for the euro zone and wider European Union showed further improvement in June. Nonetheless, recent unemployment data painted a worrying picture, especially for young people.

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