Investing.com – Overall economic activity in the euro zone missed the mark in June, but still managed to register the best quarterly growth in six years, bolstering optimism over the region’s economy, preliminary data showed on Friday.
In a report, market research group IHS Markit said that its flash Euro Zone Composite Output Index, which measures the combined output of both the manufacturing and service sectors decreased to 55.7 in June, from the prior month’s reading of 56.8 and below forecasts a drop to 56.6.
The flash services purchasing managers’ index also declined more than expected to 54.7 this month, from the prior 56.3.
Analysts had expected the index to slip to only 56.2.
However, the preliminary euro zone manufacturing purchasing managers’ index unexpectedly rose to a seasonally adjusted 57.3 this month from a final reading of 57.0 in May. Analysts had expected the index to dip to 56.8 in June.
On the index, a reading above 50.0 indicates industry expansion, below indicates contraction.
“Although the rate of growth waned to a five-month low, high order book inflows and elevated levels of business confidence meant job creation remained one of the strongest recorded over the past decade as firms continued to expand capacity to meet rising demand,” IHS Markit said.
The quarterly read was the strongest quarterly expansion in over six years, according to the report
IHS Markit chief economist Chris Williamson indicated that the survey data was consistent with growth in the euro zone accelerating to 0.7% in the second quarter from the prior reading of 0.6%.
After the report, EUR/USD traded at 1.1185 compared to 1.1173 ahead of the release, while EUR/GBP was at 0.8782 from 0.8776 earlier.
Meanwhile, European stock markets were trading lower. The Euro Stoxx 50 fell 0.42%, Germany's DAX decreased 0.25%, France’s CAC 40 traded down 0.36%, while London’s FTSE 100 lost 0.45%.