LONDON (SHARECAST) - The Eurozone’s Purchasing Managers’ Indices (PMIs) for the manufacturing sector revealed a slight improvement in August.
The final PMI manufacturing indicator came in at 45.1 points compared to 44.0 in the previous month, marking the thirteenth consecutive month below the 50-point benchmark, which signals contraction in the sector.
"The final reading of the August PMI confirms that the Eurozone manufacturing sector remains firmly in contraction territory. The rate of decline was a little slower than in July, providing some heart that the manufacturing downturn may be easing, but the sector is on course to act as a drag on gross domestic product in the third quarter," said Markit Economics’ senior economist Rob Robson.
In Spain, PMI manufacturing registered its best reading since March, up to 44.0 from 42.3 in the previous month.
In Italy, PMI manufacturing fell to a 10-month low of 43.6, down from 44.3.
In France, PMI manufacturing rose to 46.0 from 43.4.
In Germany, it recovered from a 37-month low of 43.0 to 44.7.
The data signals some improvement in manufacturing for the region in general and its main economies, except for Italy. Nonetheless, the data shows that industrial activity continues to slow down. We will have to wait to see if the manufacturing sector touches bottom in the upcoming months.
Overall, the data may have a positive impact on the euro and equities and a negative impact on bond prices.