Eurozone Purchasing Managers’ Index (PMI) data released on 23 July builds on the steady advances of the last few months as the broad economic recovery following lockdowns continues.
Eurozone Purchasing Managers’ Index (PMI) data released on 23 July builds on the steady advances of the last few months as the broad economic recovery following lockdowns continues. While manufacturing PMI data came in slightly less at 62.6 than the previous month’s reading of 63.4, it was in line with forecasts and still very expansionary. Services data accounted for the broad overall advance, jumping to 60.4 against 58.3 last month. Manufacturing firms continued to point to supply issues that obviously impacted the overall data output. Higher prices due to supply chain issues seem to be being partially passed onto consumers so this will feed through into higher inflation figures in the future, corroborating the European Central Bank’s inflation forecast.
In contrast, the UK manufacturing and services PMI numbers both missed at the headline level versus expectations and showed a slowing from the previous month. Manufacturing at 60.4 fell short of forecasts of 62.3 and the previous month’s reading of 63.9. Services at 57.8 was notably short of forecasts of 62.1 and the previous month’s reading of 62.4. The rise of the Covid-19 Delta variant in the UK and the ‘pingdemic’ might not be fully impacting PMI numbers yet, so it is probable that we could see further declines from here, despite the economy now being out of lockdown. Two steps forward and one step back it seems for the UK economy.
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