By Geoffrey Smith
May 22, 2014

FORTUNE — The euro zone’s economic recovery weakened slightly in May, but is still on course for its best quarter in three years, according to a survey released Thursday.

Research firm Markit said its Purchasing Managers’ Index for the euro zone fell marginally to 53.9 in May from a three-year high of 54.0, indicating that the region is growing at an annualized pace of between 1.5%-2.0%, according to analysts at Bank of America Merrill Lynch. A number above 50 denotes expansion.

The euro zone exited recession last year, but the recovery has struggled to build any momentum, with unemployment still near record highs in some countries, and banks still more concerned with strengthening their balance sheets rather than extending new loans to businesses and consumers.

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Markit’s surveys track responses from some 5,000 companies around the euro zone, and are seen as a good indicator of current economic conditions. If confirmed by ‘hard’ data on output and sales, the latest PMIs would represent an improvement from a sluggish first quarter, but they still continue to hide a number of important weak spots: for example, the composite index for France, the region’s second-largest economy, slipped back below 50, indicating that activity actually fell during the month. In addition, the manufacturing component of the regional index fell to a six-month low of 52.5, suggesting that the strength of the euro is causing problems for at least some of the region’s exporters. That may increase the pressure on the European Central Bank to ease policy when its governing council meets next week. BAML analysts expect the ECB to cut its key refinancing rate to 0.10% from 0.25%. Even if the region isn’t currently experiencing outright deflation, inflation is so close to zero that pressure has been building on the ECB to do something for months.

There was more clearly positive news from the UK, where the Confederation of British Industry’s latest survey found a big majority of companies reporting higher output in there three months to May, and another big majority expecting output to rise further in the coming quarter. Whereas the ECB is still more likely to loosen its monetary policy, the Bank of England appears to be edging closer to first measures to tighten it. Markets expect the BoE to raise its key interest rate as early as the first quarter of next year.

Elsewhere, it’s been a good day for data in Asia too, with HSBC’s estimate of manufacturing conditions in China hitting its highest level in five months and a similar survey in Japan suggesting that industry has digested a big increase in the domestic sales tax, an event that many saw as one of the biggest risks to the radical plans of Prime Minister Abe to get the economy going again. The Nikkei index of Japanese stocks ended up 2.1% on the day, while Hong Kong’s Hang Seng index gained 0.5%


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