The new year has started with fresh signs that the eurozone’s economic recovery is continuing. <br /><br /> Manufacturing in December expanded at the fastest pace in more than five and a half years.<br /><br /> In addition orders rose, even as companies raised their prices because raw materials cost more. <br /><br /> Surveys of companies’ purchasing managers showed growth was strongest in the Netherlands and Austria.<br /><br /> German manufacturing expansion reached its highest in almost three years, driven by rising demand from Asia and the United States. <br /><br /> France hit a five and a half year high, and Italian manufacturing activity grew at its fastest rate since June.<br /><br /> In Greece the contraction was at a slower rate.<br /><br /> “Euro zone manufacturers are entering 2017 on a strong footing, having ended 2016 with a surge in production,” said Chris Williamson, chief business economist at IHS Markit which carried out the surveys.<br /><br /> “To put the PMI data into perspective, the five-and-a-half-year high reached in December is broadly consistent with factory output growing at an impressive annual rate of approximately four percent.”<br /><br /> Firms raised prices at the fastest pace in over five years linked to the weaker euro and more expensive commodities.<br /><br /> “Policymakers will be doubly pleased to see the manufacturing sector’s improved outlook being accompanied by rising price pressures,” IHS Markit’s Williamson said.<br /><br /> The European Central Bank would like to see inflation reach almost two percent. In a surprise move last month, the ECB cut asset purchases but promised protracted stimulus to aid a still-fragile recovery and bolster weak inflation.<br /><br /> #ECB will note that the PMI shows #Eurozone #manufacturing #prices charged picked up markedly in Dec to highest level since July 2011— Howard Archer (@HowardArcherUK) January 2, 2017<br /><br /> The stronger manufacturing news pushed up stock market indexes across the region on the first trading day of 2017, but the euro fell in value.<br />
