Eurozone PMI Services was finalized at 48.8 in December, up slightly from November’s 48.7, a 5-month high. PMI Composite was finalized at 47.6, unchanged from prior month’s reading, indicating continued contraction in the broader economy.
A country-by-country analysis of Composite PMI reveals varying performances. Ireland, with PMI of 51.5, experienced a two-month low, while Spain, at 50.4, reached a five-month high. Italy’s PMI climbed to a three-month high of 48.6, and Germany’s index, at 47.4, hit a two-month low. France, at 44.8, saw a four-month high, yet its service sector remains the weakest among the top Eurozone economies.
Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank, observed that Eurozone’s service sector is undergoing a slight contraction, with job numbers marginally increasing. He stated, “It’s not quite recession territory yet for services, but the vibe is far from growth-oriented.”
Furthermore, he expressed concerns about the broader economic outlook, noting that the Composite PMI is signaling a recession in Eurozone. The bank’s GDP Nowcast model projects a consecutive contraction in the region’s output for the fourth quarter, adding credence to this recessionary warning.
In examining the service sectors of the top Eurozone countries, de la Rubia identified significant variations. Spain’s service sector is performing well, showing growth for four consecutive months. In contrast, Germany and Italy are experiencing stagnation, while France’s service sector is consistently declining, making it the worst performer in this group.
Eurozone PMI Services final release here.
