Europe has joined the US and China in powering the latest global economic upswing

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The latest batch of services and manufacturing purchasing managers index (PMI) reports have now been released, providing a snapshot on how business activity fared in March.

And the verdict? Things are looking pretty good, with activity levels continuing to improve.

The latest JP Morgan-IHS Markit Global Composite PMI — a measure that combines the performances seen across the world’s manufacturing and services sector — rose 0.4 points to 53.4 in March.

It now sits close to its highest level in more than two years.

Source: IHS Markit

The Composite PMI measures changes in activity levels across the global manufacturing and services sectors from one month to the next.

It ranges from a score of 0 to 100 with a reading of 50 deemed neutral, meaning that activity levels were unchanged from a month earlier. Anything above this level indicates that activity levels improved, while anything below suggests they deteriorated. The distance away from 50 indicates how quickly activity levels improved or deteriorated.

So at 53.4, not only did activity levels across both sectors improve in March, they did so at a faster pace than February. Activity levels have now improved for 54 consecutive months, fitting with the improvement in the global economy over that period, particularly over the past nine months.

It’s also about as comprehensive a guide on real-time conditions as one can get, surveying over 18,000 firms from over 40 countries, something that IHS Markit says accounts for an estimated 89% of total global GDP.

The group also points out that the PMI measures real events, not opinions as to what’s happening on the ground.

On that basis, it looks like the economy is going more than alright in early 2017.

Here’s how the survey’s individual activity subindices fared in March. Like the headline PMI, a reading above 50 indicates that activity levels improved.

Source: IHS Markit

All components expanded last month, including new orders which acts as a lead indicator on future levels of activity.

“(The) March data signalled slightly slower rates of increase in both new orders received and job creation in the global economy,” IHS Markit said. “However, business sentiment remained positive and improved to a level in line with its long-run average.”

The employment gauge came in at 51.8, indicating a slightly slower pace of hiring, while input prices and output charges — measuring inflationary pressures across both sectors — both increased with the acceleration in output charges indicating that higher input costs are now starting to be passed on to customers.

By individual nation or region, IHS Markit said that the strength in March was led by a continued recovery in the eurozone.

“The expansion was mostly broad-based by nation, with output rising across the US, the euro area, Japan, the UK and Russia,” the group said.

“The eurozone led the upturn, with its rate of growth accelerating to a near six-year high.

“Underlying the improvement in the euro area were stronger expansions in Germany and France, while solid — albeit slower — increases were also seen in Italy and Spain.”

Services PMI readings for China and India weren’t included in the March survey as they are yet to be released. However, if the form from both nation’s manufacturing PMIs are to be repeated, they’re both likely to reveal an improvement in activity levels.

They’ll both be released during Thursday’s trading session.

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