The manufacturing index remains the same as in July. At 45.8 it is 0.2 points above the flash estimate for August (45.6) and also 0.2 points above the consensus. This indicates that while the latter half of August was slightly better than the earlier half, there is still steady deterioration in the manufacturing industry.

The best-performing nations are Greece (52.9), Spain (50.5) and Ireland (50.4). All of which are expanding in the manufacturing sector. Italy (49.4) joins the Netherlands (47.7), Austria (44.4), France (43.9) and Germany (42.4), below the 50-growth threshold, signalling contracting their manufacturing economies.

The Eurozone's larger economies France and Germany saw worsening conditions due to steady contraction of new orders and lower sales. Factory employment was reduced further, extending the current run of job cutting to 15 months. Lower staffing numbers coincided with another month of business confidence weakening.

The rate of inflation remains high as goods producers raised the prices they charge for the first time since April 2023.

Still, today's update puts the Eurozone RPI at plus 21 and the RPI-P at plus 27. Overall economic activity is moderately outperforming market expectations.

No revision is expected to the flash estimate.

The Manufacturing Purchasing Managers' Index (PMI) provides an estimate of manufacturing business activity for the preceding month by using information obtained from a representative sector survey incorporating around 3,000 companies. Results are synthesised into a single index which can range between zero and 100. A reading above (below) 50 signals rising (falling) activity versus the previous month and the closer to 100 (zero) the faster is activity growing (contracting). Released by S&P Global, national data are included for Germany, France, Italy, Spain, the Netherlands, Austria, the Republic of Ireland and Greece. These countries together account for an estimated 89 percent of Eurozone manufacturing activity.

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 ISM manufacturing index in the U.S. and the S&P Global PMIs elsewhere, 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.

The S&P Global PMI manufacturing data give a detailed look at the manufacturing sector, how busy it is and where things are headed. Since the manufacturing sector is a major source of cyclical variability in the economy, this report has a big influence on the markets. And its sub-indexes provide a picture of orders, output, employment and prices.