August 22 - One month out from the German election and some good news for Germany's economy. The latest manufacturing and services survey shows a surge in activity - with Europe's largest economy expanding at its fastest pace since January, lifting European shares and the euro. Ciara Sutton reports.
The clock is ticking on Angela Merkel's campaign - with just one month to go until German elections. Perfectly timed for the chancellor is a raft of positive data out of the euro zone. Germany's private sector grew in August at its fastest rate since January, in a sign the country is back on track. The Index which measures growth in both the manufacturing and services sector, rose above the 50 mark separating growth from contraction. The positive news chimes with recent data pointing to an upturn in Europe's powerhouse economy - including rising industrial orders, output and exports. The manufacturing sector is expanding at its fastest rate in more than two years. And new contracts from abroad, which have suffered from weaker euro zone demand and a slowdown in Asia in recent months, have shot up for the first time since February. In contrast, France's business slump deepened this month for the first time in five months, suggesting the economy may be shrinking after a bigger-than-expected rebound in the second quarter. But forward-looking indicators in the survey look more positive - with an overall improvement expected in 2013. European shares and the euro bounced higher after the business surveys confirmed expectations of a strengthening recovery.