Service Sector and Composite PMIs Deliver EUR Support
It was a busy Eurozone economic calendar this morning. Member state and Eurozone service sector and composite PMIs were in focus.
For Spain, the services PMI fell from 56.6 to 53.4 versus a forecasted 55.2.
In Italy, service sector activity saw slower growth, with the PMI declining from 52.8 to 52.1. Economists had forecast a fall to 51.5.
For France, the services PMI rose from 55.5 to 57.4, which was in line with prelim figures.
Germany’s services PMI increased from 55.8 to 56.1, up from a prelim 55.0.
For the Eurozone, the services PMI rose from 55.5 to 55.6, up from a prelim of 54.8.
As a result, the Composite PMI slipped from 55.5 to a two-month low of 54.9, up from a prelim 54.5.
According to the March survey,
- At the composite level, service sector activity drove growth in March, with output up marginally from February.
- The upturn was supported by a loosening of COVID-19 containment measures, leading to higher activity levels to support increased demand for goods and services.
- New export orders fell for the first time since Nov-2020, with the Russian invasion of Ukraine hitting the manufacturing sector in particular.
- Inflationary pressures and supply-chain issues resurfaced, adding to the private sector woes.
- As a result, business confidence weakened across the services and manufacturing sectors.
- Output expectations tumbled to their weakest in 17-months.
- Ireland ranked first, with the composite PMI hitting a 5-month high of 61.0.
- France came in second, with an 8-month high of 56.3, followed by German, Spain, and Italy, each seeing their composites at 2-month lows.
Ahead of today’s stats, the EUR had fallen to a pre-stat and current day low of $1.09623 before rising to a pre-stat high of $1.09839.
The EUR found support over the release of today’s PMIs, hitting a day high of $1.09887 before easing back.
At the time of writing, the EUR was up by 0.10% to $1.09833.
ISM Non-Manufacturing PMI figures from the U.S. While the numbers will influence, the markets are also awaiting news of fresh EU sanctions on Russia, which will draw plenty of attention.