Spain outperforms euro area peers, highlighting ECB’s challenge

epa05208889 A photograph made available on 13 March 2016 showing a Euro symbol projected onto the European Central Bank (ECB) in Frankfurt am Main, Germany 12 March 2016. The European Central Bank (ECB) is participating in Luminale, a light show that takes place every two years in Frankfurt. Both the ECB?s main building by the river Main and the Eurotower in the city centre will be illuminated by a ?symphony? of light consisting of bars, lines and circles ? primarily in blue and yellow, the colours of the European Union. It will be based on Ludwig van Beethoven?s Prelude to the Ode to Joy, the European anthem. The euro symbol will be projected onto the south facade of the main building and will be visible to passenger planes on approach to land at Frankfurt airport. The light show takes place every day from 20:00 CET to midnight from 13 to 18 March 2016.  EPA/BORIS ROESSLER


Spanish services and manufacturing expanded at the fastest pace in two months, outpacing the country’s euro-area peers in a challenge for the European Central Bank.
The Spain Markit Composite PMI index jumped to 55.1 in March, beating the median economist estimate in a Bloomberg survey calling for an increase to 54.2. The Spanish data contrasts with sluggish growth in the euro area, which saw the same index rising marginally to 53.1 in March from 53 in February and below a flash estimate of 53.7.
The divergence among nations highlights the difficulties facing the ECB as it seeks to revitalize the euro area’s uneven recovery and prop up inflation within a context of low energy prices. The euro area probably grew 0.3 percent in the first quarter, while Spain likely expanded 0.6 percent in the same period, Markit said.
“The euro zone economy failed to show any significant momentum in March,” said Chris Williamson, Markit chief economist. He added that sluggish growth reflects “lackluster” demand accompanied by falling prices as firms across the bloc compete at the expense of margins. He noted that Spain’s expansion remains “‘impressive.”
With the euro zone showed limited momentum, Spain continued to push ahead, beating Germany, Italy and France, even as lawmakers in Madrid struggle to pierce together a working government coalition. With no natural alliances in a four-way split parliament, the nation is facing a May 2 deadline to form a government or call fresh elections in June. So far, polls show no end to the deadlock with no single party expected to obtain a majority.
Despite the political deadlock in Spain, the economy has shown signs of resilience with jobless claims falling more than expected in March, adding to two months of falling unemployment. Meanwhile, a second index tracking growth in the services sector expanded to a four-month high for the month with business sentiment rising to the highest level so far this year as new orders and activity jumped in March.

Leave a Reply

Send this to a friend