Service sectors expand

Monday mostly brought positive economic news.

Retail sales data in the euro area was not one of them. Bloomberg reports:

European retail sales fell for a 15th month in August as rising unemployment curbed consumer spending.

Store revenue in the 16-nation euro region declined 2.6 percent from a year earlier after sliding 1.9 percent in July, the European Union’s statistics office in Luxembourg said today. Economists predicted a drop of 2.4 percent, according to the median of 13 forecasts in a Bloomberg News survey. From the prior month, sales fell 0.2 percent.

However, the eurozone economy may already have returned to growth. Again from Bloomberg:

Europe’s manufacturing and services industries expanded more than initially estimated in September, adding to signs the economy is gaining steam after the worst recession in six decades.

A composite index of both industries in the euro-area economy rose to 51.1, up from 50.4 in August and higher than an initial estimate of 50.8, London-based Markit Economics said today in a statement. A reading above 50 indicates expansion and the gauge, which is based on a survey of purchasing managers, had remained below that level for 14 months before topping it in August. Economists had projected the index would rise to 50.9 in September, according to a Bloomberg News survey...

The euro-area services index rose to 50.9 in September from 49.9 in the previous month, today’s report showed. While a gauge of manufacturing remained below 50, indicating contraction, it increased to 49.3, the highest since May 2008, data showed on Oct. 1.

In the UK, service activity accelerated in September. Reuters reports:

The service sector expanded at its fastest pace for two years in September, and firms were more optimistic about the next 12 months than at any time since April 2007, purchasing managers' data showed on Monday...

The headline PMI number rose to 55.3 in September from August's 54.1, its fifth successive month above the 50-level that divides growth and contraction and above economists' forecasts of a rise to 54.5, the data from Markit and the Chartered Institute of Purchasing and Supply showed.

And not about to be left out is the US service sector. From Bloomberg:

U.S. service industries expanded in September for the first time in a year as the emerging recovery spread from housing and factories to the broader economy.

The Institute for Supply Management’s index of non- manufacturing businesses, which make up almost 90 percent of the economy, rose to 50.9, higher than forecast, from 48.4 in August, according to the Tempe, Arizona-based group. Fifty is the dividing line between expansion and contraction.