Spain and Italy resurgence helps eurozone factory output to expand

Eurozone factory output expanded at a faster pace than initially estimated in August, driven by a resurgence in Italy and Spain, as the 17-nation currency bloc’s recovery began to build momentum.

An index based on a survey of purchasing managers in the manufacturing industry increased to a 26-month high of 51.4 from 50.3 in July, London-based Markit Economics said. That’s above an estimate of 51.3 published on Aug 22. A reading above 50 indicates growth.

Encouraging indicators have begun to accumulate since the eurozone returned to growth in the second quarter, ending a record-long recession. Economic confidence soared to a two-year high in August. The Stoxx Europe 600 Index has risen 5% in the last two months, and the euro gained 1.8% against the dollar.