Euro area services output grows for first time in 19 months

Euro area services expanded in August for the first time in 19 months, led by Germany, after the 17-nation currency bloc's economy emerged from a record-long recession.

An index based on a survey of purchasing managers rose to 51 from 49.8 in July, London-based Markit Economics said today. Economists forecast an increase to 50.2, according to the median of 32 estimates in a Bloomberg News survey. A reading above 50 indicates expansion.

Gross domestic product in the euro region rose 0.3 per cent in the three months through June after six quarterly contractions. The expansion was led by the region's two biggest economies, Germany and France. At least four euro countries remain in recessions, including Italy and Spain. "We have seen some improvement in recent months, but we're starting from very low levels," said Frederik Ducrozet, an economist at Credit Agricole CIB in Paris. "There's a good chance the economy will pick up further in the second half of the year. Spain and Italy might start growing again as well."