Europe Services Growth Accelerated More Than Forecast - by Sandrine Rastello
Growth in Europe's service industries accelerated more than economists forecast in February, prompting investors to reduce bets on European Central Bank interest-rate cuts. A preliminary estimate of Royal Bank of Scotland Group Plc's services index rose to 52.3 from 50.6 in January. Economists expected a reading of 51, according to the median of 38 forecasts in a Bloomberg News survey. The euro rose as the report indicated economic growth in Europe is withstanding a slowdown in the U.S. and U.K., reducing the need for the ECB to lower borrowing costs. While the European Commission yesterday cut its forecast for the euro region's 2008 expansion to 1.8 percent, the weakest since 2005, it predicted accelerating inflation.
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