Euro manufacturing and services expand

Euro-area services and manufacturing expanded faster than economists forecast in April, indicating the economy continued to strengthen at the start of the second quarter.

A composite index based on a survey of purchasing managers in both industries rose to 54 in April from 53.1 in March, London-based Markit Economics said.

The report supports European Central Bank president Mario Draghi’s view that the 18-nation euro area is in a “modest” recovery. Still, the crisis in the Ukraine and the strength of the euro are threatening to undermine growth, while Markit’s survey may reinforce policy makers’ deflation fears, showing that companies cut prices for a 25th straight month.