Eurozone: PMI falls in February
February 21, 2018
Leading data suggests that the Euro area’s economic momentum softened somewhat in February. The preliminary Eurozone Composite Purchasing Managers’ Index (PMI), produced by IHS Markit, fell from a nearly 12-year high of 58.6 in January to 57.5 in February. The result undershot market analysts’ expectations of a softer dip in the index to 58.5. Despite the fall, the composite PMI still lies well above the 50-threshold, signaling expanding business activity in the Eurozone.
Activity continued to boom across the economy, however, at a slightly softer pace than in the previous month. The manufacturing and services PMIs both ticked downwards in February, although continued to point to robust growth. New orders and employment growth moderated slightly, while business optimism rose to a level not seen since 2012. Meanwhile, price pressures remained elevated amid strong demand.
Regarding the two largest Eurozone economies, the composite PMIs for France and Germany both edged down in February. However, the indicators still pointed to strong growth in the major-players. Elsewhere in the region, business activity also grew at a more subdued rate, although the reading marked the second-best result in nearly 12 years.
Eurozone GDP Forecast
FocusEconomics Consensus Forecast panelists expect the Eurozone economy to expand 2.2% in 2018, which is unchanged from last month’s forecast. For 2019, panelists expect the economy to grow 1.9%.