Eurozone PMI

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Eurozone: Flash PMI rebounds in July, indicates that recovery is regaining momentum

July 24, 2014

The flash estimate of the Markit Eurozone PMI Composite Output Index came in at 54.0 in July. The result was up from both the 52.8 recorded in June and the 52.8 market analysts expected. The composite PMI—the result of a survey of over 5,000 manufacturing and services businesses—has been above the 50-threshold that signals a stable economic outlook since July of last year, which points to ongoing recovery in economic activity. Moreover, the July reading, which marks a rebound following a decline in both May and June, suggests that the Eurozone economy kicked off the second half of 2014 on stronger footing.

The July improvement was underlined by stronger performance in the services sector; the sub-component that tracks services activity reached the highest level in more than three years. The manufacturing activity sub-component, however, only accelerated moderately over the previous month. The pace of job creation remains subdued despite the overall improvement, but, according to Markit, “the continuous trend of moderate job creation seen over the past four months represents an improvement from the significant pace of job losses being recorded this time last year.”

At a country level, Germany’s composite PMI accelerated from 54.0 in June to 55.9 in July. The July acceleration marks a rebound over the slowdown recorded in June. France’s composite PMI rose from 48.1 in June to 49.4 in July. Despite the improvement, the index is resting in contractionary territory for a third consecutive month. The composite PMI for all the other countries in the region improved for the third consecutive month and reached highs not seen since August 2007.

FocusEconomics Consensus Forecast panelists expect the economy to expand 1.1% in 2014, which is unchanged from last month’s forecast. For 2015, panelists expect the economy to expand 1.5%.


Author:, Head of Data Solutions

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Euro PMI July 2014

Note: Markit Purchasing Managers’ Index (PMI) Composite Output. A reading above 50 indicates an expansion in business activity while a value below 50 points to a contraction
Source: Eurostat


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