Services companies in the U.S. and Asia gained ground in January, while a continued contraction in the eurozone threatened a double-dip recession, surveys of purchasing managers showed.
The eurozone economy shrank in the final three months of last year amid high Covid-19 infection rates and related restrictions posed the risk of a double-dip recession. Surveys compiled by data firm IHS Markit released Wednesday showed the eurozone’s service sector fell to 45.0 from 46.4 in December. A reading above 50 indicates growth, while a level below 50 signals contraction.
Another quarter of declining output would leave it further behind the U.S. and China in charting a recovery from the pandemic’s toll.
By contrast, IHS Markit said its U.S. services index was 58.3, up from 54.8 in December and the second-sharpest increase in almost six years.
Stronger client demand and an upturn in new business drove the expansion, said Chris Williamson, IHS Markit’s chief business economist. Many companies indicated that they see demand reviving even more as business restrictions imposed amid a coronavirus surge late last year are relaxed.
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