The Olympics in Paris gave a new impetus to the economy of the Eurozone

The eurozone economy received an unexpectedly strong boost from the Paris Olympics, which helped boost private sector growth to its fastest pace in three months.

This is reported by the Bloomberg agency. The S&P Global Composite Purchasing Managers' Index jumped to 51.2 in August from 50.2 in July, beating even the most optimistic analysts' forecasts, the data showed. This index is an important indicator of business activity, which indicates the gradual improvement of the economic situation in the region.

The indicator for the service sector rose to the highest level since April, which had a positive effect on the overall dynamics of the economy. However, despite the positive news, the decline in production in the Eurozone deepened, which may indicate existing problems in the industrial sector.

Economists warn that the eurozone will struggle to maintain its strong momentum in the first half of 2024, even despite a sporting surprise from the Olympics. In particular, only slight growth of the German economy is expected throughout the year.

Weakness in the eurozone economy also prompted renewed calls for the European Central Bank to cut interest rates again next month. The first round of rate cuts took place in June, but the rise in inflation in July and the increase in prices for private sector products in August indicate that the economic difficulties are not over yet.

Business activity indexes are closely watched by investors and analysts because they are published at the beginning of each month and reflect trends and turning points in the economy. Although these indices are an important measure of overall activity, they can be difficult to interpret because they reflect more the breadth of changes in output than their depth in the context of quarterly GDP.