Novel coronavirus (Covid-19) was brought under control in developed countries, and economic activities, supported by the enlargement policies of the monetary and financial authorities, put the worst behind and repaired the devastating damage of the outbreak.
In the Eurozone in July, Manufacturing Purchasing Managers’ Index (PMI) rose 7.8 per cent to 51.1, while Service Purchasing Managers’ Index (PMI) rose 14.0 per cent to 55.1, according to preliminary (p) data released today by IHS Markit, a London-based global information provider.
During the first half of the year, PMI data, which measured the activity level of managers in the locomotive sectors of the economy, pointed to a sharp decline and contraction as a result of economic activities that were minimised by measures to contain the outbreak in the Eurozone countries. Service sector, led by tourism, restaurant and retail businesses, fell to a record level in April, especially with harsh quarantine measures imposed by public authorities, while the manufacturing sector experienced its strongest decline in the last 11 years due to significant restrictions on the amount of inputs and supply chain delays due to the global shock caused by the pandemic.
In the context of measures that were gradually lifted by bringing the outbreak under control in many Eurozone countries as of May, economic activity began to recover, leaving the worst behind. The enlargement policies of the Eurozone countries and the European Central Bank (ECB) during this period had a significant effect on the recovery, limiting the decline in economic activity. With the increase in business activities in July, manufacturing PMI exceeded threshold 50 for the first time since February 2019, and service PMI also signaled a growth again after 3 months. However, considering that the PMI data is calculated on a monthly basis, it is necessary to highlight that this transition above threshold does not mean a complete recovery of losses in those sectors, yet just an increase compared to the previous month.