Euro zone business activity ended the first quarter on a higher note, surveys show. Could extra stimulus from the ECB be having a positive effect? Ivor Bennett reports.
There were questions of whether he'd lost his touch. Hands full with lagging growth but no tools to deal with it. Less than two weeks on from his last round of monetary easing, it seems Mario Draghi's stimulus policies may be taking effect. Composite PMIs for the euro zone rebounding from February's one-year low and pointing to first quarter growth of 0.3 percent. SOUNDBITE (English) CHRIS BEAUCHAMP, SENIOR MARKET ANALYST, IG, SAYING: "It can only be temporary really, you can't keep that feel-good feeling going forever. But if we can get a follow-through with more data in the months to come with improved activity and improved confidence of course, crucially, then you might see this PMI reading built upon in the rest of the year." France was the stand out performer. Private sector activity growing at its fastest pace in 5 months. Services were the saviour - both there and in Germany - helping to offset a dip in demand for exports. Not a worry for business though. The closely watched IFO index indicating morale rose in March for the first time in three months. SOUNDBITE (German) KLAUS WOHLRABE, IFO ECONOMIST, SAYING: "February's marked lack of confidence has diminished. And the turmoil in China has eased, while expectations for exports have climbed. But the most significant thing we're seeing in our figures is the German consumer spending so readily." In the bloc as a whole though, consumer confidence is down. while the PMI reading for input prices in Germany plummeted by the sharpest rate since August 2009. If signs of weakness are only underlying in Europe, in Japan there very much on the surface. PMIs contracting for the first time in nearly a year after a sharp fall in exports.