London/Frankfurt: The much awaited rebound in Euro-area growth momentum may have finally begun.

A gauge measuring private-sector activity unexpectedly increased in June, suggesting the economy is gathering pace after a slow start to the year. With output strengthening in the bloc’s two largest economies, Germany and France, the numbers underpin the European Central Bank’s prediction that a rebound is on the cards, even if it arrives later than expected.

Japan’s manufacturing sector also strengthened in a sign global economic prospects remain favourable. A gauge for the US is due later on Friday.

But the better figures comes amid the shadow of a looming trade war, with the US and Europe announcing tit-for-tat tariffs on products, and Daimler AG saying that profit will suffer as a result. Policymakers including ECB President Mario Draghi issued warnings this week, while multiple other central banks have singled out protectionism as a threat to the outlook.

Despite that, ECB officials decided last week that it’s time to unwind crisis-era stimulus. A day after the Fed raised interest rates for the second time this year, European policymakers announced they will end bond purchases by December, trusting that heightened global uncertainty won’t derail growth.

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The euro area’s composite purchasing managers’ index climbed to 54.8 in June from 54.1 in May, according to IHS Markit. The median estimate in a Bloomberg survey was for a drop to 53.9. The increase was driven by services, while a slowdown in manufacturing persisted.

Growth in the region slowed to 0.4 per cent in the first quarter from 0.7 per cent at the end of last year. The ECB predicts quarterly expansions of 0.5 per cent through the end of 2019, and Draghi said last week that the recent “soft patch” may last longer, but that didn’t change the view of underlying momentum.

Markit’s report showed that business expectations fell to a 19-month low in June, while factory orders rose the least in almost two years.

“The details of the survey warn against any complacency,” said Chris Williamson, chief business economist at Markit. “While the June upturn provides some hope that the weakening of official data earlier in the year may have overstated the region’s weakness, the risks remained tilted towards a further slowdown in the second half.”