Business activity in the euro zone has expanded at the fastest pace this year so far in October, as a buoyant Germany offset the impact from firms raising prices at the sharpest rate in more than five years. As Laura Frykberg reports, the upturn in both activity and prices will make welcome reading for policymakers at the European Central Bank.
Positive data out of the euro zone. Business activity expanded at its fastest rate this year in October. Jumping to 53.7 from 52.6 last month. That's despite firms raising the price of their goods at the sharpest rate in more than five years. (SOUNDBITE) (English): DARREN SINDEN, INDEPENDENT MARKET ANALYST, SAYING: "I think that the ECB can be slightly more optimistic about this latest round of PMI data then it was before - let's put it like that." The figures from data indicator Markit reveal Germany as the star performer. Rising above 55 (55.1) in October - its highest reading since last year. But good for Germany - isn't necessarily good for its neighbours. (SOUNDBITE) (English): DARREN SINDEN, INDEPENDENT MARKET ANALYST, SAYING: "Germany is able to run large surpluses whilst some of the other euro zone countries are in a much more uncomfortable position. One thing that the euro hasn't done, and the whole European experiment, is be able to smooth out those imbalances and spread the benefits around the continent as a whole." PMI's out of Europe's second largest economy paint a mixed picture. French manufacturing increased to a 10-month high of 51.3 in October. While the service sector, eased back to a three month low.