EUROZONE DATA: May Services PMI Revised Higher; Composite Remains Just Above 50

The Eurozone May services PMI was revised up to 49.7 (vs 48.9 flash, 50.1 prior), following an upward revision in France and a stronger-than-expected Italian print. We estimate the Germany/France combined services PMI at 47.9 (vs 48.3 prior), and the ex-Germany/France measure at 52.8 (vs 51.6 flash, 53.2 prior). 

That helps the composite PMI remain just about in expansionary territory for the fifth consecutive month (it has had a range of 50.2-50.9 through this year), consistent with positive, but sluggish growth. A reminder that the ECB is expected to revise its GDP projections lower at tomorrow's decision, but this will likely be centred in 2026. See more in our ECB preview.

Notes from the Eurozone-wide services release:

• "New business continued to decline, stretching the current sequence of decrease to four months. The deterioration in demand for services was the most pronounced in six months, albeit modest. A sharper drop in international orders was partly to blame, with export sales also falling to the quickest degree since November last year".
• "Outstanding business volumes were depleted for a thirteenth successive month in May. This was facilitated to some degree by greater workforce numbers, with services employment rising again"
• "Muted hiring activity came amid another month of subdued business confidence. Although future output expectations strengthened, they remained weak by historical standards".
• "There was little movement on the inflation front, with rates of input cost and output charge inflation holding fairly close to those seen in April and remaining above the respective survey averages".