Business activity across Europe expanded at its fastest pace in a year during April as a resurgence in the continent’s services industry helped to offset a downturn in manufacturing.
Europe’s Purchasing Managers’ Index (PMI), which is compiled by S&P Global (SPGI) and considered a gauge of economic health, rose to 51.7 in April from 50.3 in March.
April was the second consecutive month that Europe’s PMI was above the 50 mark that separates growth from economic contraction. It was also the highest level since May 2023.
The services sector’s PMI increased to 53.3 in April from 51.5 in March, above the flash estimate of 52.9.
Employment in the services sector also continues to grow, with headcount rising at the fastest pace in a year and the employment index increasing to 53.5 from 52.3.
However, manufacturing activity across Europe took a turn for the worse in April, highlighting continued weakness in that sector.
Overall, optimism about the year ahead remains strong in Europe. The composite future output index that measures optimism remained unchanged at 61.6 in April, its highest level since 2022.
