In January in the euro area the flash PMI services index marks 50.7 points from 49.8 previously. Manufacturing activity on the other hand passes from 47.8 previous to 48.8 current, against 48.5 expected while the composite index scores 50.2 points from 49.8 expected and 49.3 previous.
The EU “is not out of the woods yet, S&P Global analysts underline, as demand continues to decline – but only at a reduced rate – and a recovery in the inflation rate of the selling prices of goods and services will encourage hawks to push for further tightening of monetary policy. The hypothesis of an increase in interest rates is further fueled by the recovery in employment growth recorded during the month and by the signs of rising wages that guide the latest recovery in price pressures”. “The political caution is underpinned by the fact that the survey merely points to stagnation in the eurozone economy, suggesting that a further slide towards contraction should not be ruled out as borrowing costs rise, but the survey undoubtedly brings good news suggesting that any downturn is likely to be much less severe than previously feared and that a recession could be avoided altogether.”