Manufacturing in the eurozone has hit a 10-month high, and with services on a 46-month peak the economic indicators haven’t looked this good in four years.
With industrial demand for bank loans now surging there are grounds for believing an economic recovery is gathering pace, and a first rise in business lending in three years is expected to be posted this month.
Economic activity in France has also risen for a second month even if the pace of reforms there remains slow, and prices, while still contracting, posted their strongest showing in eight months.
“The turn of the credit cycle in the eurozone, for us, is one of the key reasons we think growth is going to be much better over the coming years. The ECB QE programme can deliver confidence, can deliver a boost to consumer and investor sentiment, but long-term you actually need credit growth to drive the economy forward,” says JP Morgan’s Kerry Craig.
The better figures come just as the ECB is starting to spray its hundreds of billions of stimulus euros around the EU economies to boost growth and spur inflation, and in global terms they offset the rather poorer figures coming out of the world’s number two economy, China.