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Improvement In Eurozone Services Sector

James Boston
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Improvement In Eurozone Services Sector

Europe’s Services sector is faring somewhat stronger than the manufacturing sector according to the most recent Purchasing Managers Indices (PMI). Markit Economics have this morning provided updates on the July Services PMI numbers from the main Eurozone economies. The headline Eurozone Services PMI reading has clearly risen to 54.2 from a June reading of 52.8, this didn’t quite make the market consensus for an increase to 54.4. The positive Services number was enough to contribute to an overall gain on the PMI Composite figure for the month, this came in at 53.8 compared to 52.8 in June, market consensus however was for a slightly higher 54.0 reading.

Italy has the dubious honour of being the only large Eurozone economy to post a fall on it’s Services PMI data for the month, the reading has come in at 52.8 in comparison to June’s 53.9, markets were taken by surprise by the Italian number as a gain to 54.0 had been anticipated.

The remaining core Eurozone economies all managed gains this month. Germany’s July Services PMI reading posted a healthy 56.7 in comparison to the 54.6 level seen last month, today’s reading also topped expectations for a 56.6 number. This translated into a gain in the German PMI Composite reading which came in at 55.7, this represents an increase from the 54.0 seen the previous month but fell very slightly short of the 55.9 anticipated by the market.

The French number has managed a move back above the key 50 level that denotes the difference between contraction and expansion in the sector. The July reading is now 50.4 compared to just 48.2 in June, this rise was in line with expectations. On the Composite side the French number is improved but still remains subdued at 49.4, the previous month was 48.1 and there was no expectation for a change from this.

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