EUROZONE DATA: September Services/Composite PMI: Flash Essentially Confirmed

Cross-country development in the September services PMIs were broadly offsetting, meaning the Eurozone-wide release was only a shade lower than the flash at 51.3 (vs 51.4 flash, 50.5 prior). It’s still the joint highest reading this year.

• We estimate the Germany/France services PMI at 50.2 (vs 49.5 prior), the first expansionary reading in eight months. Meanwhile, the ex-Germany/France index rebounded to 53.1 (vs 52.2 in August, 53.2 in July).
• The Eurozone-wide employment index “was only fractionally up from the level seen in August”….”this marked the weakest month for the eurozone service sector labour market in over four-and-a-half years when the latest expansionary trend in workforce numbers began”.
• Germany appears to have dragged down the rest of the region on the employment front: “The extent to which [German services] employment fell was in fact the most marked since June 2020.”
• There was a fall in new export orders across the region. Meanwhile, although wage increases were reported across countries, “inflation ticked lower at the end of the third quarter. Input costs and output prices rose at their slowest rates in two and four months, respectively”.

The composite PMI confirmed the flash reading at 51.2 (vs 51.0 prior), the highest since May 2024. 

• “The euro area economy continued its expansionary trend at the end of the third quarter, with the pace of growth even ticking slightly higher to its strongest since May 2024. That said, the upturn was again a muted one as demand barely improved and employment levels decreased. A pick-up in confidence for the first time since June was nevertheless recorded”.