Eurozone flash Manufacturing PMI rises unexpectedly faster-than-estimates to 52.8 in August

Sagar Dua FXStreet

Preliminary HCOB Manufacturing Purchasing Managers’ Index (PMI) in the Eurozone expands surprisingly at a faster pace to 52.8 in August from 51.9 in July. Manufacturing activity was anticipated to expand at a moderate pace to 51.8.

An expansion in both manufacturing and the service sector activity led to a strong growth in the Composite PMI, which arrived higher at 52.1 than estimates of 51.7 and the prior release of 52.0.

The Service PMI remains steady at 51.7, higher than estimates of 51.5.

Market reaction

No major reaction is seen in the Euro (EUR) following the Eurozone PMI data release. At press time, EUR/USD trades 0.1% higher at around 1.1690.

Economic Indicator

HCOB Manufacturing PMI

The Manufacturing Purchasing Managers Index (PMI), released on a monthly basis by S&P Global and Hamburg Commercial Bank (HCOB), is a leading indicator gauging business activity in the Eurozone manufacturing sector. The data is derived from surveys of senior executives at private-sector companies from the manufacturing sector. Survey responses reflect the change, if any, in the current month compared to the previous month and can anticipate changing trends in official data series such as Gross Domestic Product (GDP), industrial production, employment and inflation. The index varies between 0 and 100, with levels of 50.0 signaling no change over the previous month. A reading above 50 indicates that the manufacturing economy is generally expanding, a bullish sign for the Euro (EUR). Meanwhile, a reading below 50 signals that activity among goods producers is generally declining, which is seen as bearish for EUR.

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