Euro zone business activity unexpectedly grew this month, a preliminary survey showed, but with much of Europe suffering a third wave of coronavirus infections and renewed lockdown measures, that may not last through April.

Factories ramped up output at the fastest monthly pace in over 23 years, countering a continuing slowdown in the currency blocs dominant services industry, which is far more vulnerable to lockdowns and the regions slow vaccine rollout.

IHS Markits flash composite PMI, seen as a good guide to economic health, bounced above the 50 mark separating growth from contraction, to 52.5 in March compared to Februarys 48.8, its highest since late 2018.

Even the most optimistic respondent in a Reuters poll had forecast it would rise to 51.0, while the median predicted only a modest increase to 49.1.

Marchs rise in the euro zone composite PMI pushed it back above the 50 mark for the first time in six months, but the recent tightening of restrictions in a number of countries suggests that the improvement will not be sustained, said Jessica Hinds at Capital Economics.

Indicating Europes largest economy was so far shrugging off pandemic lockdowns, German factory activity rose to a record high and the services sector expanded after five successive months of contractions.

In France, the 19country euro zones secondlargest economy, activity held up better than expected, with manufacturing surging ahead at the fastest pace in more than three years.

A rush of new…