|Composite - Level||54.1||54.2||53.6|
|Services - Level||54.4||54.4||53.8|
There were no significant revisions to the flash PMI data in the final report for June. Hence, at 54.4 the services PMI matched its preliminary reading while at 54.2, the final composite output print was just a tick higher.
As previously signalled, private sector economic growth hit a 4-year high in June mainly reflecting fresh advances in new orders and employment. For services, headcount expanded for an eighth straight month with the pace of increase only just short of May's four-and-a-half year peak. Business expectations remained positive. However, profit margins continued to be squeezed with costs rising over the month but selling prices declining for a remarkable forty-third month in a row.
In terms of all-sector output growth, the best performer across the region was Ireland (60.9) which registered a 6-month high ahead of the second placed Spain (55.8) despite the latter falling to a 6-month low. Italy (54.0) posted a 1-year high and there were much needed gains in the core with the Germany (53.7) back at moderate growth levels and France (53.3) at a forty-six month peak.
The final June PMI data should be in line with growth in Eurozone real GDP of about 0.4 percent last quarter. This would be consistent with a still sluggish recovery and one lacking the momentum required to give HICP inflation a significant boost. The need for QE remains as strong as ever.
The Eurozone Composite PMI is produced by Markit and is based on original survey data collected from a representative panel of around 5,000 manufacturing and services firms. National manufacturing data are included for Germany, France, Italy, Spain, the Netherlands, Austria, the Republic of Ireland and Greece. National services data are included for Germany, France, Italy, Spain and the Republic of Ireland.
The Eurozone Services PMI (Purchasing Managers' Index) is produced by Markit and is based on original survey data collected from a representative panel of around 2,000 private service sector firms. National data are included for Germany, France, Italy, Spain and the Republic of Ireland. These countries together account for an estimated 80% of Eurozone private sector services output.
Investors need to keep their fingers on the pulse of the economy because it dictates how various types of investments will perform. By tracking economic data such as the purchasing managers' manufacturing indexes, investors will know what the economic backdrop is for the various markets. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers less rapid growth and is extremely sensitive to whether the economy is growing too quickly and causing potential inflationary pressures.
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