Euro Zone Business Activity Rebounds in January, as Indicated by PMI

According to a report on Wednesday, Eurozone business activity rebounded at the beginning of the year following two months of decline. The final composite Purchasing Managers' Index (PMI) for the Eurozone rose to 50.2 in January, compared to December's 49.6, marking a slight growth above the 50 mark that separates contraction from expansion.

The expansion in the services industry, the dominant sector within the Eurozone, was modest with a PMI of 51.3, slightly lower than December's 51.6. Chief economist Cyrus de la Rubia from Hamburg Commercial Bank highlighted the importance of the services sector in sustaining the Eurozone's economic growth.

While services firms increased their workforce to meet rising demand, their optimism for the future slightly declined. De la Rubia noted that uncertainties, especially upcoming elections in Germany and the fragile government in France, are contributing to cautious outlooks for growth in the sector.

Furthermore, input costs and prices charged by businesses rose sharply last month. The European Central Bank cut interest rates recently and is considering another reduction in March to boost economic activity.