Eurozone PMIs were all stronger than expected - TDS

Research Team at TDS, notes that this morning’s Eurozone PMIs for July were all stronger than expected, as the continent seems to have largely shrugged off Brexit fears.

Key Quotes

“The French manufacturing PMI rose from 48.3 to 48.6 (mkt 48.0) and the services PMI from 49.9 to 50.3 (mkt 49.5). In Germany the manufacturing PMI slipped from 54.5 to 53.7 (mkt 53.4) and the services PMI rose from 53.7 to 54.6 (mkt 53.2).

The PMI data supports the ECB’s decision to remain on hold yesterday, and to wait for more data and new forecasts before determining if the negative impact from Brexit warrants further easing. This morning we also saw the results of ECB’s Survey of Professional Forecasters that Draghi discussed during yesterday’s press conference. As he already mentioned, long-run inflation expectations were unchanged at 1.8%, while growth expectations for 2017 and 2018 saw only marginal downgrades.”