Eurozone Bounces Back: Mixed Signals as Trade War Looms

Factory activity displayed early signs of recovery in the euro zone, while Asia's outlook dimmed due to U.S. tariff tensions. Eurozone manufacturing output improved, but might face setbacks from new tariffs. China's economy showed resilience, yet Asian markets remained under pressure from U.S. trade policies.

Factory activities in the euro zone showed promising signs of recovery in March, but Asia experienced a downward trend as the U.S. tariff war intensified and global demand slowed, dampening business sentiment, according to recent surveys.

The euro zone's manufacturing sector witnessed output increases for the first time in two years, with its Purchasing Managers' Index (PMI) nearing the 50-mark critical for growth, yet potential impacts from further trade tariffs remain a concern. Inflation waning in the region also points to a possible European Central Bank interest rate cut this month.

In Asia, China's manufacturing activity picked up, but the broader region experienced declines in countries like Japan, South Korea, and Taiwan, as businesses anticipate further uncertainty in U.S. trade policies which may counter the short-term recovery.

(With inputs from agencies.)