Eurozone April business activity nears 3-year high

Eurozone business activity hit a near three-year high in April as a modest economic recovery gained momentum and began creating jobs, a closely watched survey showed on Wednesday. Markit Economics said its Eurozone Composite Purchasing Managers Index (PMI) for April, a leading indicator of overall economic activity, jumped to 54 points from 53.1 in March, the highest reading since May 2011. The report also marks the 10th month running for which it has come in above the 50-points boom-or-bust line, reinforcing the view the recovery is finally taking hold. "The eurozone has started the second quarter on a solid footing," Markit chief economist Chris Williamson said in a statement. "A welcome quickening in the pace of growth of business activity in April means the region is expanding at the fastest rate for almost three years," Williamson said. The outcome suggests the economy will grow by 0.5 percent in the second quarter, up from 0.4 percent in the first three months of the year, he added. The eurozone finally got out of a record 18-month recession in second quarter 2013 with growth of 0.3 percent, but that slipped back to 0.1 percent in the third before recovering to 0.3 percent again in the last three months of the year. “The return to job creation across the region is also very encouraging news in respect of companies believing that the recovery has legs and is looking increasingly sustainable," Williamson said. At the same time, he warned of the continued danger of deflationary pressures. "With selling prices falling at the fastest pace since last August despite the upturn in activity, there will be growing fears that deflationary pressures are intensifying," he said.