Eurozone Services Sector Weakens
The Markit Economics Manufacturing data across the Eurozone disappointed markets yesterday. The follow on Services Purchasing Managers Indices (PMI) today don’t appear to be offering any more of a positive outlook. The headline number for August for the single currency bloc is now reading at 53.1, this has fallen from July’s 54.2 and misses the market expected figure of 53.5. On a Composite basis the overall Eurozone PMI index now stands at 52.5, down from the prior month’s 53.8 and slightly below the 52.8 that the market had been hoping for.
Germany particularly missed expectations this month, markets were looking for a Services figure of 56.4 which would have represented a slight fall from the July number of 56.7, instead Germany reported a surprising drop to 54.9. The German Composite PMI now stands at 53.7, this is a drop from July’s 54.9, the fall in the Composite was fully anticipated.
The Italian Services PMI is the largest disappointment among the set, the August number is reported as taking the sector into contraction. Today’s reading of 49.8 represents a significant shift from July’s 52.8 and surprised markets that were anticipating a more moderate drop to just 52.0. Italy’s Composite PMI is now reading at 49.9 down from the 53.1 reported during the previous month.
France’s fall was more moderate, the Services PMI for this economy now stands at 50.3 which represents a slight contraction on the 50.4 seen in July, the disappointment here came because analysts were anticipating a rise in this number to 51.1. The French Composite PMI is now showing at 49.5, down from July’s 50.0.
Both Spain and Ireland managed gains in their Services PMI figures for the month of August. Spain increased from 56.2 to 58.1 against an expectation of 55.1 while Ireland posted a rise to 62.4 from 61.3 in July.
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