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Euro zone composite PMI holds near 4-year high in December

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Investing.com -

Investing.com - Economic activity in the euro zone dipped slightly in December, but held near the prior month's four-year peak, boosting optimism over the health of the region's economy, preliminary data showed on Wednesday.

In a report, market research group Markit said that its Flash Euro Zone Composite Output Index, which measures the combined output of both the manufacturing and service sectors eased down from 54.2 in November to 54.0 in December, below forecasts for 54.2.

The preliminary euro zone manufacturing purchasing managers' index rose to a seasonally adjusted 53.1 this month, a 20-month high and up from a final reading of 52.8 in November. Analysts had expected the index to hold steady at 52.8 in December.

Meanwhile, the flash services purchasing managers' index declined to 53.9 this month from 54.2 in November, missing expectations for a reading of 54.1.

On the index, a reading above 50.0 indicates industry expansion, below indicates contraction.

The euro zone economy saw a solid end to 2015, with robust growth leading employers to take on extra staff at the fastest rate for just over four-and-a-half years.

Commenting on the report, Chris Williamson, Chief Economist at Markit said, "Although the PMI edged lower in December, the fourth quarter as a whole saw the largest increase in business activity for four-and-a-half years. The survey is signaling a quarterly GDP rise of 0.4%, meaning the region grew 1.5% in 2015."

EUR/USD inched up to 1.0943 from around 1.0939 ahead of the release of the data, while EUR/GBP was at 0.7284 from 0.7283 earlier.

The Investing.com euro index, which tracks the single currency against a basket of six major rivals, dipped to 88.02, compared to 88.00 ahead of the report.

Meanwhile, European stock markets turned lower after the open. France's CAC 40 shed 0.2%, the EURO STOXX 50 dipped 0.2%, Germany's DAX slumped 0.1%, while London's FTSE 100 inched up 0.3%.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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