Euro zone businesses had a strong October


Business activity across the euro zone expanded at its fastest rate in 2016 during October.

IHS Markit's euro zone flash composite Purchasing Managers' Index edged up to 53.7 - an increase from 52.6 in September. Any figure above 50 indicates growth.

A poll of economists carried out by Reuters had expected the reading to come to 52.8.

"With demand firming, companies were increasingly able to charge higher rates to customers. Average prices charged for goods and services rose for the first time since August 2015 ... Higher prices were often a reflection of the need to pass rising costs on to customers. Average input costs increased at the steepest rate for 15 months, linked mainly to higher commodity prices, notably oil-related, as well as rising wage costs," Markit commented.

The sub-index measuring output prices grew from 50 to 50.5 - its highest reading since 2011.

Last week the European Central Bank (ECB) left its headline interest rate unchanged at 0% - and the bank did not announced any changes to its quantitative easing programme.

In September, the ECB created committees of eurozone central bankers to pool ideas as to how to extend or wind-down the bond buying scheme.

The bank's president, Mario Draghi has said that changes to the programme may be announced in December when new growth and inflation forecasts are released.

Joseph Conroy, 

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