Eurozone PMIs offer nothing new after ECB breaks no new ground - BBH

Research Team at BBH, suggests that the small declines posted in by the Eurozone aggregate readings pale in comparison with the UK.  

Key Quotes

“The Eurozone flash manufacturing fell to 51.9 from 52.8.  This is just below the median expectation.  The flash services PMI slipped to 52.7 from 52.8.  The median forecast was for 52.3.  These results generated a composite of 52.9 compared with 53.1 in June and an expectation for a decline to 52.5.

Germany saw a smaller than expected fall in manufacturing (53.7 vs 54.5 in June and 53.4 median forecast).  The service sector improved to 54.6 from 53.2.  The median expectation was for 53.7.  The German composite rose to 55.3 from 53.6.  This is the strongest composite reading since 2011.  It points to a good start to Q3 after a softer Q2.

France also saw improvement.  The manufacturing PMI rose to 48.6 from 48.3.  It has not been above 50 since February.  The service PMI bounced back to 50.3 from 49.9.  These developments were sufficient to lift the composite to 50.0 from 49.6.

The flash Eurozone report follows yesterday's ECB meeting, in which no new ground was broken.  Draghi indicated the ECB will review its monetary policy setting in September by which time there will be new economic data and the staff forecasts will be updated.  Despite the urgency in some quarters, Draghi clearly indicated that there were no discussions about a pending shortage of assets or a move away from the capital key criteria.  This too looks like something that will be taken up after the summer.  Draghi emphasized the ECB's flexibility.

The euro is little changed today.  It is holding above $1.10, but has been capped near $1.1040.  Yesterday’s initial attempt to buy the fact after selling the rumor stalled at $1.1060.  Continued narrow range trading is likely to prevail ahead of the weekend.  Recall that the euro hit $1.09 when the results of the UK referendum back clear and the following session, it held $1.0970.”