Latest data released by Markit/BME - 24 July 2020
- Prior 45.2
- Services PMI 56.7 vs 50.5 expected
- Prior 47.3
- Composite PMI 55.5 vs 50.2 expected
- Prior 47.0
Much like the French reading, services are showing a solid beat and the headline in itself is a positive takeaway that business conditions are improving relative to June at least.
Manufacturing activity is also seen picking up so that will at least keep the optimism flowing that the euro area recovery is on the right track - for now.
Should labour market conditions falter moving forward, that will be a real test to the robustness of this recovery - a similar case across the euro area region.
Markit notes that:
"July's PMI registered firmly in growth territory and well above expectations, in a clear sign that business conditions are improving across Germany as activity and demand recover. Furthermore, for an economy that is steered so much by exports, it was encouraging to see manufacturers reporting a notable upturn in sales abroad.
"However, one of the main concerns remains the labour market, and the ongoing cuts to manufacturing jobs in particular, with July even seeing a slight acceleration in factory job losses. That said, with backlogs among goods producers stabilising and business confidence continuing to improve, there's some cause for encouragement that the decline in manufacturing employment will start to ease off in the coming months."
