The Eurozone manufacturing PMI published by S&P Global has risen to 47.8 in the preliminary reading for December from 47.1 points in November. This is the best result seen in the last three months, and also exceeds the 47.1 expected by the market.
The Services PMI has also improved, rising six tenths to 49.1 and exceeding the 48.5 points previously and forecast by the consensus. This is the best figure seen by the indicator in the last four months.
Despite the improvements, both indicators remain in contraction territory below 50 points.
Commenting on the preliminary PMI data, chris williamsonchief business economist at S&P Global Market Intelligence, said: “While the sharper drop in business activity in December signals a strong possibility of recession, the survey also hints that any recession will be milder than thought a few months ago. The fourth quarter data is in line with GDP contracting to a quarterly rate of just under 0.2%, and forward-looking indicators currently bode well for the rate of decline to ease further in the first quarter.
“The slowdown in the manufacturing sector moderated particularly markedly in December, led by Germany and linked to a combination of better supply conditions and lower fears of energy restrictions. The malaise in the services sector has also subsided, partly fueled by signs of easing fears about a contraction in the cost of living and, in the financial services sector, reduced concerns about tightening financial conditions.”
EUR/USD reaction
The pair has rallied slightly to 1.0660 following the German PMI release, but has subsequently fallen almost 30 pips towards around 1.06330 on Eurozone PMI data. At time of writing, EUR/USD is trading above 1.0633, gaining 0.07% daily.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
