BRUSSELS (AFP) – A widely-watched index of manufacturing activity in the 16-nation eurozone hit a 14-month high in August, still indicating contraction but continuing a gradual rise up from historic lows.

The eurozone's purchasing managers' index (PMI) for the manufacturing sector, published by data and research group Markit on Monday, rose to 48.2 points in August, well above the 46.3 percent seen in July.
The rise brought the index closer to the 50-point threshold above which the eurozone's manufacturing base is expanding and well above the 33.5 points seen back in February.
However it still marked the 15th straight month of contraction as Europe's economy struggles to get itself out of recession.
“Most encouragingly, the output and new orders sub-indices pointed to modest expansion in August,” commented Howard Archer, chief European economist at research consultancy IHS Global Insight.
“Completing the healthier news, employment in the manufacturing sector contracted at the slowest rate for 10 months in August, although the fall was still pretty substantial,” he added.
“Despite these improvements, the survey showed also some signs of concern.” according to Clemente De Lucia at French bank BNP-Paribas.
“Today’s data reported that there is a divergence among the largest economies of the area. From one side German and French manufacturing output rose in August, while activity continued to contract in Spain and Italy,” De Lucia added.
Photo:
BMW employees work on rear suspensions at the German luxury carmaker's plant in Dingolfing, southern Germany, in 2008. (AFP/File/Lennart Preiss)