The month of October so far has witnessed this year’s fastest pace of business activity in the eurozone.
Events were cheered on by consumer spending, despite prices rising at their sharpest rate in more than five years, according to the respected Markit survey.
The survey took analysts by surprise as most forecasts had been lower.
Germany’s economy outperformed predictions and was at its highest this year. Europe’s largest economy entered the fourth quarter well, led by a healthy uptick in manufacturing.
The private sector in France expanded but at a slower pace than had been hoped while its service sector business lagged. Manufacturing, however, picked up.
Subsequent to the report, Spain’s stock market rallied on Monday as hopes were raised that the 10-month political deadlock that has paralysed the country may soon be ended.
Spain's conservative leader Mariano Rajoy and his People’s Party are on course for another term in power after the Socialists agreed on Sunday not to block his bid in a confidence vote this week, ending an impasse which began with last December’s general election.
Overall, the euro area’s dominant service industry performed above expectations, as did manufacturing. New business growth picked up sharply, leading to increased confidence that the trends could continue into November.
It will now be up to the European Central Bank to decide whether to maintain or reduce its current quantitative easing stimulus programme.
It has already spent over a trillion euros buying government bonds, cut some rates to zero and instituted a negative deposit rate, in addition to lending billions of euros to commercial banks to lend on to customers.
