This Wednesday Markit Group, will publish the preliminary data of the PMI of the United Kingdom, France, Germany and the data for the Euro Zone.
The PMI, an index that gives a short-term account of the macroeconomic status of these countries or regions, must be taken into account because values lower than 50.0 show an economic contraction. While values above that measure, speak of economic growth.
The services sector is the most affected for the European countries, while manufacturing production shows in all cases that it has increased or positive results are expected and above 50.0 points.
France’s PMI for the manufacturing sector is currently at 56.1, the result is expected to be around 56.6, marking growth for the fourth consecutive month. In relation to the services PMI, since August, which is below the fifty-point measurement, the last measurement was 45.6 and the result is expected to be lower. The composite PMI, averaging the previous measurements, is expected to be 47.2, against the previous 47.0.
Germany’s PMI, in its manufacturing version, is likely to remain projected at around 60.8, close to 60.7 the previous month. The services PMI remains below fifty points since September and is projected to grow to 46.2 from the previous 45.7. No big changes are projected for the composite PMI, staying close to the previous measurement, at 51.3.
The manufacturing PMI of the Euro Zone is projected to remain above 57 points, between 57.7 and 57.9 of the last measure. In relation to services, they project growth towards 46 points, while for the composite PMI, it is not expected to exceed 50.0 points but it is expected to reach 48.8 against 48.1 in the last month.
For the United Kingdom, the projections remain similar. The manufacturing PMI will remain near 55 points, probably slightly below the previous 55.1. For the services sector, it is projected to exceed 50.0 points, reaching 51.1.
If the projections hold, moderate growth is maintained for the last month, as the low increase in the services PMIs, below fifty points, will be offset by the moderate growth in manufacturing production.
Faced with mostly positive results, shocks may occur. The EURUSD is currently at 1.1848 being in the sell zone, it could resume buy strength if it passes 1.19. GBPUSD currently at 1.3705 holds its buy position from 1.39 between 1.3920 and 1.3930.