Business activity in the European Union expanded in March for the first time in six months, according to preliminary figures from IHS Markit.
The flash composite index of business activity for the Euro zone, which looks at activity across both manufacturing and services, reached 52.5 in March versus 48.1 in February. A reading above 50 represents an expansion in economic activity.
The preliminary data points to the first economic expansion in the European Union since September of last year and the largest increase since July 2020.
Manufacturing has been the biggest driver of economic performance in Europe this month, but the services sector, which has been the hardest hit by the global pandemic, also experienced an improvement, hitting a seven-month high.
However, there are concerns about how the European Union will perform in the second quarter of this year as social restrictions remain a reality. Germany decided this week to extend its lockdown and France has re-imposed lockdown measures due to rising COVID-19 infections.
The European Central Bank estimated earlier in March a gross domestic product (GDP) rate of 4% for the European Union this year and 4.1% for 2022.
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