Eurozone: PMI ticks up in August - ING

Bert Colijn, Senior Economist at ING, notes that the Eurozone PMI increased marginally from 54.3 to 54.4 in August, confirming a solid pace for the Eurozone economy in 3Q

Key Quotes

“The PMI indicated output growth in both industry and services, but the economy has not yet got a second wind.”

“New orders continued to grow, albeit at a slower pace. Job growth continues to be the positive highlight for the eurozone economy, with service sector businesses maintaining significant job growth.”

“While Germany and France showed surprising improvements in their PMIs, the overall eurozone figure increased by just 0.1. This suggests that the periphery performed rather poorly in August, which will be confirmed in a later release.”

“Eurozone GDP is still set for decent growth in the second half of the year of around 0.4% quarter-on-quarter, as domestic demand should continue to drive the economy forward.”

“Expectations about growth in the coming months have been cooling, which could hurt investment and hiring plans.”

“Today’s PMI was somewhat more difficult to interpret, indicating that businesses have been increasing selling prices significantly, but the pace of increases has been the slowest in three months.”