Eurozone March final services PMI 55.6 vs 54.8 prelim

• Composite PMI 54.9 vs 54.5 prelim

Looser COVID-19 restrictions helped to see euro area services activity climb to a four-month high, but the overall composite reading slumped to a two-month low as softer manufacturing output weighed. Business confidence also took a big hit amid the Russia-Ukraine conflict, slumping to a 17-month low with surging inflation Inflation Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Read this Term pressures also dampening the outlook. S&P Global notes that:

"The further reopening of the eurozone economy amid the fading Omicron wave has provided a welcome tailwind to business activity in March, helping drive a further solid expansion from the slowdown seen at the start of the year.

“However, the resilience of the economy will be tested in the coming months by headwinds which include a further spike in energy costs and other commodity prices due to Russia’s invasion of Ukraine, as well as worsening supply chain issues arising from the war and a marked deterioration in business optimism regarding prospects for the year ahead.

“Exports are already back in decline as the war has directly hit travel and transport, and the downturn in confidence suggests that domestic demand conditions across the eurozone could also come under pressure, notably from consumers via the soaring cost of living, at the same time as companies struggle with a lack of materials.

“The outlook for growth has therefore deteriorated at a time when the inflation outlook has worsened. A recession is by no means assured, as the extent to which the economy could suffer in the coming months will depend on the duration of the war and any changes to both fiscal and monetary policy. It certainly seems likely however that the solid expansion seen in March will prove hard to sustain and there is clearly a greater risk of the economy stalling or contracting during the second quarter."