In February, employment plunged by 697 000 according to the ADP report, while the consensus was looking for a decline by 630 000. The January outcome was downwardly revised from -522 000 to -614 000. The breakdown shows that 338 000 jobs were lost in the goods-producing sector, of which 219 000 in manufacturing. In the service providing sector, employment dropped by 359 000 in February. Assuming that government payrolls are broadly unchanged, the official payrolls might show a job loss of around 700 000, while the consensus expects a figure of -650 000.

Non-manufacturing ISM dropped in February after rising in the two previous months. The headline index fell from 42.9 to 41.6, while the consensus expected an outcome of 41.0. Business activity (40.2 from 44.2), new orders (40.7 from 41.6), imports (39.0 from 40.5) and backlog of orders (36.5 from 37.5) deteriorated further, while new export orders (40.0 from 39.0) and employment (37.3 from 34.4) improved somewhat. Prices paid were higher (48.1 from 42.5), while inventory data were mixed. Although the better than expected headline figure, the details remain fragile as both business activity and new orders deteriorated further.


EMU: Services PMI slightly upwardly revised

According to the final figure, euro zone services PMI was slightly upwardly revised from 38.9 to 39.2 in February. Although upwardly adjusted, the figure is still 3 points below the January figure and the details remained very weak with all sub-indices at record lows. So there is no reason to be optimistic as services PMI is still at a record low level.


Other: UK services PMI shows third consective rise

In the UK, services PMI unexpectedly improved in February. The headline index rose from 42.5 to 43.2, while the consensus was looking for a slight worsening (41.9). Looking at the details, new business (42.5 from 42.2), business expectations (56.7 from 56.0) and employment (40.4 from 40.2) rose marginally. Input prices were reported slightly lower, while prices charged climbed. This is the third consecutive rise in sentiment in the services sector, but services PMI remains still significantly below the benchmark level of 50.