Eurozone business growth accelerates to a four-year high in June

 
Jessica Morris
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Markit predicts the Eurozone economy will expand by two per cent this year (Source: Getty)

Eurozone business growth accelerated to a four-year high in June, as factories and services firms reported stronger growth and hiring.

The Markit Composite Flash Purchasing Managers' Index (PMI) rose to 54.1 in June, up from 53.6 a month earlier, and in line with economists' expectations.

PMI has now been above the crucial 50 threshold that separates growth from contraction for two years.

The reading suggests that the Eurozone economy has so far managed to shrug off uncertainty stemming from the Greek debt negotiations.

"Despite the cloud of the Greek debt crisis hanging over the region, the Eurozone saw economic growth accelerate to a four-year high in June," Chris Williamson, chief economist at Markit, said.

"The PMI is signalling gross domestic product growth of 0.4 per cent for the region as a whole in the second quarter.

Read more: Hope of Greek breakthrough spurs market

Markit said that the acceleration puts the region's economy on course to grow by two per cent this year, however this depends on the outcome of high stakes talks between Greece and its creditors.

"The second quarter upturn signalled by the PMI puts the region on course to expand by around two per cent this year, though much of course depends on the outcome of the Greek debt negotiations and any resulting impact on growth in the second half of the year," he said.

"The uncertainty generated by the recent escalation of the crisis appears to have taken some of the steam out of hiring growth, but employment over the second quarter as a whole has nevertheless shown the largest rise for four years to suggest that – at present at least – the Eurozone economy is weathering the Greek storm relatively well."

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