PMI steady at over one-year low in April
Leading data suggests that the Euro area’s economic momentum remained downbeat in April, starting the second quarter on a lackluster note. The preliminary Eurozone Composite Purchasing Managers’ Index (PMI), produced by IHS Markit, was unchanged at March’s 14-month low of 55.2 in April. The result, however, overshot market analysts’ expectations of a dip in the index to 54.9. The composite PMI lies well above the 50-threshold, signaling expanding business activity in the Eurozone.
Production growth remained weaker than seen at the start of 2018 in April and new orders grew at the slowest pace in 15 months. Dampened orders from abroad, partly due to a strong euro, weighed on new business and orders in the services sector were particularly downbeat. However, job creation was robust in April, with services sector employment rising at the fastest pace since October 2007.
Regarding the two largest Eurozone economies, the composite PMIs picked up slightly in France and Germany, although failed to regain all of March’s lost ground. Elsewhere in the region business activity came in at an 18-month low.