Buoyant French economy ahead of election a boon to eurozone

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Eurozone private sector growth hit a fresh six-year high in April, survey results from IHS Markit showed today, helping limit regional losses to some extent.

Data monitoring company IHS Markit said its April Composite Purchasing Managers Index came in at 56.7 points, the highest reading since April 2011 and up from 56.4 points in March. An index measuring output jumped to 58.0 from 57.5, the highest since April 2011.

With a score above 50 indicating growth, IHS Markit said that its latest PMI data, if maintained, points to second-quarter growth of 0.7%.

"Such strong growth, if sustained, will inevitably lead to upward revisions to economists' 2017 forecasts", said Chris Williamson, the firm's chief business economist.

"Robust rates of expansion are being seen in both manufacturing and services, the former clearly benefitting from the weak euro, which has helped drive export sales growth to a six-year high".

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Helping the cause was French business activity roundly trouncing expectations in April, growing at its fastest pace in almost six years as its citizens prepare to head to the polls this Sunday.

Euro-area economic momentum accelerated to its fastest pace in six years, with France unexpectedly outperforming Germany in a strong start to the the second quarter that suggests the recovery is broadening.

Meanwhile, the French presidential election takes place on Sunday and will likely be the main driver of the Euro next week.

Although no major survey sees her winning, far right and anti-European Union leader Marine Le Pen is polling strongly. European bourses were also unsettled by the Paris shooting on Thursday evening.

"Elsewhere in the region the pace of expansion has accelerated to a near 10-year high, cementing the increasingly broad-based nature of the upturn", Williamson said. Still, few economists think that the European Central Bank will announce any change at next week's policy meeting given that underlying inflation remains weak. The Office for National Statistics found that retail sales in the country fell by a whopping 1.8 percent in March, reversing the previous month's 1.7 percent rise.

One major outcome of Britain's Brexit vote has been the sharp fall in the pound.