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23 June 2020

Latest UK and Eurozone PMI Figures: The Only Way is Up

Saul Fulda, Investment Analyst

The data emerging from Europe today points towards a recovery in the manufacturing and service sectors, albeit from the floor breached in April. Purchasing Managers’ Indices (PMI) rose around the continent, reflecting the easing of lockdowns and slow return to normality.

In the UK, the composite figure for June, an average of the services and manufacturing sectors, jumped to 47.6 from the previous month’s 30, illustrating the stabilisation in the economy, and the likelihood of a return to growth in the third quarter. 

In Germany, the composite PMI rose to 45.8 from 32.3 in May while France delivered an astonishing 51.3 in June, above the 50 mark separating growth with contraction, and outshining May’s 46.3. For the wider Eurozone, the composite PMI improved to 47.5 from 31.9 last month.  

While these are flash estimates, the data is nonetheless impressive, indicating that the economic recovery is underway. Yet, we should not get too carried away - the possibility of a second wave of COVID-19 cases remains on the horizon while demand is still sluggish and consumer sentiment tentative, and uncertainties surrounding the European job market persist, given its strong reliance on government support.
 
Latest UK and Eurozone PMI Figures: The Only Way is Up
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