Services PMI 47.7 vs 46.4 prelimPrior 47.6Composite PMI 48.5 vs 47.5 prelimPrior 48.8<\/p>\n
Despite the troubles in France, the overall Eurozone services economy managed to hold up in May. However, private sector business activity as a whole fell to an 18-month low and marked back-to-back months of
\ncontraction for the first time since the end of 2024.<\/p>\n
Looking to the services sector, total new order inflows fell again for a third straight month. And while slowing from April, the pace of decline was
\nnonetheless the second-sharpest since November 2024.<\/p>\n
On the prices front, the latest data showed a further intensification of
\ninflationary pressures across the region. Input
\ncosts rose at the sharpest rate in three-and-half years, while
\ncharge inflation hit a 38-month high. Trouble, trouble.<\/p>\n
S&P Global notes that:<\/p>\n
“With business activity in the eurozone falling for a second
\nsuccessive month in May, it is looking increasingly likely
\nthat the economy will slip into contraction in the second
\nquarter. The PMI data are indicating a 0.2% quarterly GDP
\ndecline barring any significant change in June.\n<\/p>\n
“Price pressures have meanwhile intensified to their
\nmost worrying for over three years, hinting at inflation
\npotentially running close to 4% in the coming months.\n<\/p>\n
“These price pressures will sit uncomfortably with the
\nECB, which will want to be seen as acting swiftly to prevent
\nhigher inflation from becoming entrenched. However,
\npolicymakers will also clearly be concerned that they could
\nbe hiking rates into a downturn, adding to recession risks.\n<\/p>\n
“Hence, while one interest rate hike might be seen as
\nan insurance policy, the case for further rate hikes will
\nbe harder to make if the economy continues to weaken,
\nnot least as this softening of demand will itself constrain
\npricing power and wage growth.”<\/p>\n","protected":false},"excerpt":{"rendered":"Services PMI 47.7 vs 46.4 prelimPrior 47.6Composite PMI 48.5 vs 47.5 prelimPrior 48.8 Despite the troubles in France,…\n","protected":false},"author":2,"featured_media":712574,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[64,63,99,164],"class_list":["post-712573","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-au","tag-australia","tag-business","tag-economy"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/712573","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=712573"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/712573\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/712574"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=712573"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=712573"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=712573"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}