Factories and businesses in Europe grow at the fastest pace in 9 months
WHAT HAPPENED
In August, factories and service companies in the eurozone grew at the fastest pace in nine months. The indicator rose to 52.1 points, driven by manufacturing and more orders from abroad.
WHY IT MATTERS
More orders can increase hiring, purchases from suppliers, and transportation. But if the economy accelerates, inflation could decrease more slowly, and the region's central bank could keep rates high, making loans and mortgages more expensive.
AND FOR YOUR PORTFOLIO
For a long-term portfolio, the data improves the outlook for industrial companies and their European suppliers. At the same time, high rates pressure indebted businesses and consumption. In practical terms, financing a home or business may continue to cost more.
💬 TELL IT LIKE THIS
“Europe is growing thanks to its factories, but that momentum could delay the reduction of rates and keep loans expensive.”