• Eurozone Manufacturing PMI arrives at 47.8 in December vs. 47.1 expected.
• Bloc’s Services PMI rises to 49.1 in December vs. 48.5 expected.
• EUR/USD extends gains above 1.0650 on the encouraging Eurozone PMIs.

The Eurozone manufacturing sector contraction eased in December, the latest manufacturing activity survey from S&P Global research showed on Friday.

The Eurozone Manufacturing purchasing managers index (PMI) arrived at 47.8 in December vs. 47.1 expectations and 47.1 last. The index reached a three-month top.

The bloc’s Services PMI stood at 49.1 in December vs. 48.5 expected and November’s 48.5, hitting a four-month high.

The S&P Global Eurozone PMI Composite climbed to 48.8 in December vs. 48.0 estimated and 47.8 previous. The gauge registered fresh four-month highs.

Comments from Chris Williamson, Chief Business Economist at S&P Global

“While the further fall in business activity in December signals a strong possibility of recession, the survey also hints that any downturn will be milder than thought likely a few months ago.”

“The data for the fourth quarter are consistent with GDP contracting at a quarterly rate of just less than 0.2%, and forward-looking indicators are currently boding well for the rate of decline to ease further in the first quarter.”

FX implications

EUR/USD extends gains above 1.0650, cheering the upbeat euro area PMIs. The spot is adding 0.22% on the day.