Fra S&P Global:
Commenting on the flash PMI data, Dr. Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank, said:
“At first glance, this looks like a pleasant surprise: activity in the Eurozone picked up in August. But a closer look at the
numbers reveals that the underlying fundamentals might be shakier than they appear. The boost largely comes from a surge
in services activity in France, with the Business Activity Index jumping by almost five points, likely linked to the buzz
surrounding the Olympic Games in Paris. It’s doubtful this momentum will carry over into the coming months, however.
Meanwhile, the overall pace of growth in the services sector has slowed down in Germany, and the eurozone’s
manufacturing sector remains in rapid decline.
“It’s a tale of two worlds. The manufacturing sector remains mired in recession, while the services sector still appears to be
growing at a decent clip. But with the temporary Olympic boost in France fading and signs of waning confidence across the
Eurozone’s service industry, it’s likely only a matter of time before the struggles of the manufacturing sector start weighing
on services too.
“Manufacturers raised their selling prices for the first time since April 2023, a response to three straight months of rising input
costs. Despite weakening demand, firms seem to have had little choice but to pass on some of these higher costs to
customers. On the bright side, this suggests there’s still some pricing power in the market.
