Eurozone business activity growth steady in January: key survey

BRUSSELS, Belgium, Jan 23 (AFP): Eurozone business activity maintained a steady, if modest, rate of growth in January, a closely watched survey said Friday.

The HCOB Flash Eurozone purchasing managers' index (PMI) published by S&P Global -- an important gauge of the overall health of the economy -- was at 51.5, unchanged from December. Any reading above 50 indicates growth, while a figure below 50 shows contraction. Activity in the manufacturing sector was buoyed by an increase in orders, S&P Global said. However, the service sector grew at a slower pace. The Eurozone economic "recovery still looks rather feeble", said Cyrus de la Rubia, chief economist at Hamburg Commercial Bank. "The start into the new year points to more of the same in the months to come." He said that the overall picture would be "anything but reassuring" for the European Central Bank as it weighed future interest rate decisions because inflation in the service sector has increased. "As a result, ECB members are likely to feel validated in holding rates where they are. Some of the more hawkish members may even argue that the next move should be up rather than down," de La Rubia said.