In the first part of the day, the calendar of important publications of economic data was dominated by PMI indicators. They illustrate the activity of the industrial and service sector. It is assumed that they show trends in the economy in advance. Their results arise on the basis of surveys conducted among the managerial staff, which assesses the situation in the industry from various perspectives.
It turns out that In July, the Composite PMI indicator increased from 50.6 to 51 points. The result above the limit of 50 points means a good economic situation. PMI indexes from industry and services in the largest countries were close to this level.
“In the face of universal uncertainty, an economy showing a slight growth, growing employment and poor inflation seems surprisingly stable” – comments Bert Colijn, economist of ING.
PMI indexes from the euro area
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Macronext
He emphasizes that at the moment It is difficult to get a clear picture of the economic situation of the euro area. The importing of European goods to the United States is still largely influenced by the incoming data. This makes it difficult to assess the actual condition of the production sector. He adds that fortunately the PMI indicator provides a bit more information.
“The PMI indicator indicates a slight economic growth in July, after a weak second quarter. It is particularly encouraging to improve the situation in the service sector. As the largest part of the euro area economy, this is of great importance for the prospects of economic growth in the third quarter, “says Bert Colijn.
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What about industrial production? “It was fluctuated depending on the development of the commercial situation, but the PMI indicator indicates that in recent months a slight increase in production has been reported. On the other hand, in July new orders in industry weakened, so Maintaining economic recovery, especially in the face of uncertainty about a possible trade agreement with the USA, is very uncertain” – says the economist.
PMI indexes. Signals of revival
Estimates that Inflation data contained in the PMI index indicate weakening in both the goods and services sector. Demand for employees has increased again, which, combined with all external threats to economic perspectives, creates quite favorable conditions for growth.
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The economists of Bank Pekao also referred to the PMI industry for July PMI readings for the Euro Zone industry. “They point to a continuation of revival. The situation in PMI from Germany is similar” – they pointed out in the post on the Platform X.
MBank economists speak in a similar tone.
