Manufacturing Sector PMIs and German Unemployment Figures Fail to Give the EUR a Boost

It was a particularly busy start to the day on the economic data front. From the Eurozone, manufacturing sector PMIs and German unemployment figures were in focus.

Manufacturing Sector PMIs

Member States

In May, Spain’s manufacturing PMI increased from 57.7 to 59.4, with Italy’s PMI rising from 60.7 to 62.3.

Economists had forecast PMIs of 59.5 and 62.0 respectively.

Finalized PMIs from France, Germany, and the Eurozone also drew attention.

Germany’s PMI fell from 66.2 to 64.4, which was up from a prelim 64.0.

France’s manufacturing PMI increased from 58.9 to 59.4, up from a prelim 59.2.

A pickup in manufacturing sector activity in Italy and Spain and upward revisions to French and German PMIs led to an upward revision to the Eurozone’s manufacturing PMI.

The Eurozone

In May, the Eurozone’s manufacturing PMI increased from 62.9 to a new record high 63.1. This was up from a prelim 62.8.

According to the Eurozone’s Markit Survey,

• All three market groups recorded strong improvements in operating conditions.
• Investment goods producers were the best performing in May, reporting marked increases in output and new orders.
• Intermediate goods and consumer goods categories both saw stronger growth.
• New orders surged off the back of demand across the bloc and from overseas.
• Sourcing inputs from vendors constrained production activity.
• Deliveries from suppliers deteriorated at a severe and unprecedented rate in the month.
• As a result, input costs jumped again, with output prices rising at the fastest pace on record.
• Firms increased payrolls, with the rate of hiring the most marked since January 2018.
• Sector optimism remained high, while easing to its lowest level in the last 4-months.

By Country:

• The Netherlands (69.4) and Austria (66.4) hit new record highs to rank 1^st and 2^nd.
• Germany came in 3^rd in spite of a 3-month low PMI of 64.4.
• Ireland (64.1) and Italy (62.3%) also hit record highs to rank 4^th and 5^th
• France (248-month high), Spain (276-month high), and Greece (253-month high) sat at the bottom of the rankings.

German Unemployment

Employment figures from Germany were also skewed to the positive.

In May, unemployment fell by 15k, reversing an 8k rise from April. As a result of the fall, the unemployment rate held steady at 6.0%, which was in line with forecasts. Economists had forecast a more modest 9k fall in unemployment, however.

Market Impact

Ahead of today’s numbers the EUR had fallen to a pre-stat low $1.22183 before rising to a pre-stat high $1.22377.

In response to today’s stats, the EUR struck a post-stat and current day high $1.22415 before sliding to a post-stat and current day low $1.22149.

At the time of writing, the EUR was down by 0.08% to $1.22177.

Next Up

Eurozone inflation and unemployment figures are due out ahead of U.S manufacturing PMI numbers for May.

Expect the Eurozone’s inflation figures and markets preferred ISM Manufacturing PMI from the U.S to be key areas of focus.