Eurozone: Composite PMI edges up in August
August 22, 2019
Leading indicators point to slightly improved dynamics in August in the Euro area’s economy. The Flash Eurozone Composite Purchasing Managers’ Index (PMI), produced by IHS Markit, came in at 51.8, up from July’s 51.5. That said, the reading still marked one of the worst results in the past six years. The PMI lies just above the 50-point threshold that distinguishes expanding business activity in the Eurozone.
The details of the release revealed a continued two-speed Eurozone economy. The manufacturing PMI came in at 47.0 in August, up from July’s 46.5 but still signaling contractionary conditions in the sector. Manufacturing output fell for the seven consecutive month and firms shed jobs once again. In contrast, the Services PMI Activity index edged further into expansionary territory in August, coming in at 53.4 (July: 53.2). On a sour note, confidence dropped sharply in August across both sectors.
Regarding the Eurozone’s two largest economies, both France and Germany’s composite PMIs edged up in August. However, while France’s manufacturing PMI returned to growth territory, Germany’s continued to point to contractionary conditions. Elsewhere in the region, activity was broadly stable.