Euro jumps after better than expected French and German economy data

Euro jumps after better than expected French and German economy data

Germany's private sector economy ended the third quarter strongly, with business activity growth accelerating to the fastest in nearly six-and-a-half years, according to flash PMI survey data from IHS Markit.

"The US economy showed encouraging resilience in a month of hurricane disruption", IHS Markit economist Chris Williamson said.

The euro jumped to 1.99 against the United States dollar after output in services and manufacturing jumped to 56.7 in September from 55.7, according to the respected IHS Markit's Flash Composite Purchasing Managers' Index for September.

The "flash" PMI reading for September - which is based on about 85% of replies to the survey - rose to 56.7 from August's reading of 55.7.

Inflows of new orders showed the largest monthly increase since April 2011. "Across both manufacturing and services, job creation was the second-highest seen over the past decade", notes IHS Markit. Companies in the services sector slowed some, while manufacturing growth ticked up, IHS Markit wrote in flash results released Friday, Sept. 22, but overall private sector growth increased strongly.

"The goods-producing sector was again buoyed by rising exports, the rate of growth of which dipped slightly - linked to the recent appreciation of the euro - though remained slightly above the average seen so far this year". Services business was the main growth driver despite a slight retreat in growth rates this September.

The services PMI improved to a 6-month high of 55.6 from 53.5 in August.

It pointed out that the rise in business activity and inflationary pressures would fuel expectations the European Central Bank will, as has always been awaited, start to rein in its asset purchase programme.

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