Prior 50.5Composite PMI 50.9 vs 51.0 prelimPrior 50.6<\/p>\n
The readings reaffirm a slight improvement in euro area business activity in July but overall levels remain relatively subdued at best. The survey noted that the rate of increase in business activity remained sluggish and was weaker
\nthan the survey average as stagnant demand held back output. France remains the notable weak link in all of this of course. HCOB notes that:<\/p>\n
\u201cThis could turn out to be a good summer for service providers. In Italy and Spain, business activity rose more sharply in July
\nthan in the previous month, while Germany, after several challenging months, has clawed its way back into growth territory.
\nThe standout performer is Spain, where the Purchasing Managers\u2019 Index jumped by more than three points\u2014pointing to a
\nthird quarter that\u2019s off to an exceptionally strong start.\n<\/p>\n
\u201cFrance, by contrast, is the only one of the four major eurozone economies where the private services sector is contracting.
\nWorse still, the downturn deepened. One key factor is the government\u2019s plan for sweeping budget cuts, which could weigh
\nheavily on economic growth. Speculation is mounting that the administration may face a vote of no confidence, adding to the
\nalready high level of uncertainty. While Spain is stepping on the gas, France is firmly on the brakes.\n<\/p>\n
\u201cEmployment in the eurozone\u2019s services sector has been expanding uninterruptedly since February 2021. At first glance, this
\nmight suggest a sector in robust health, but productivity \u2013 as measured by separate S&P Global PMI data \u2013 has been
\ndeclining since mid-2022, with only a brief pause around the turn of the year. This points to a troubling disconnect: even in
\nthe age of digital business models, growth in the services sector is not translating into meaningful productivity gains. Given
\nthat more than half of gross value added in the eurozone comes from services, this is a disquieting diagnosis.\n<\/p>\n
\u201cInflation is easing in the eurozone\u2019s services sector, increasing the likelihood of one further interest rate cut by the
\nEuropean Central Bank in the second half of the year. Costs are rising at a pace that is the slowest in nine months and
\nbelow the long-term average. This dovetails with recent data from the ECB\u2019s Wage Tracker, which shows a deceleration in
\nwage growth\u2014an essential cost component for service providers\u2014over the past several months.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Prior 50.5Composite PMI 50.9 vs 51.0 prelimPrior 50.6 The readings reaffirm a slight improvement in euro area business…\n","protected":false},"author":2,"featured_media":48752,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[84,1294,56,54,55],"class_list":["post-48751","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-uk","tag-united-kingdom","tag-unitedkingdom"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/48751","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=48751"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/48751\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/48752"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=48751"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=48751"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=48751"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}