The German manufacturing and services sectors slowed their pace of expansion in June amid falling exports and strong inflation, the preliminary manufacturing activity report from S&P Global/BME research showed this Thursday.
The Manufacturing PMI in Eurozone’s economic powerhouse came in at 52.0 this month vs. 54.0 expected and 54.8 prior. The index slumped to 23-month lows.
Meanwhile, Services PMI dropped from 55.0 booked previously to 52.4 in June as against the 54.5 estimated. The PMI registered the lowest level in five months.
The S&P Global/BME Preliminary Germany Composite Output Index arrived at 51.3 in June vs. 53.1 expected and May’s 53.7. The gauge reached six-month troughs.
“June’s flash PMI data show that Germany’s economy has lost virtually all the momentum gained from the easing of virus-related restrictions, with growth in the service sector cooling sharply for the second month in a row in June.”
“But perhaps the biggest cause for concern is a broad-based decline in demand, with a deepening downturn in manufacturing new orders coinciding with a first fall in service sector new business for six months, as rising prices and elevated levels of uncertainty take a toll. Activity is still being supported to some extent by workloads built up earlier in the year, however.”
EUR/USD is holding the lower ground near 1.0520, down 0.45% on the day. The spot caught a fresh selling wave as the downbeat French and German PMIs ring recession bells.
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