Purchasing Managers See Some Deceleration In German And French Manufacturing

Markit Economics, which conducts a monthly survey of purchasing managers in some 30 countries, publishes "Flash" estimates of the Purchasing Managers Surveys for the Euro Area as a whole and for Germany and France. The Survey covers the manufacturing and the service industries and a composite of the two. The data are in the form of diffusion indexes. Values above 50 indicate expansion and those below 50, contraction. The Flash estimates come out about a week or so before the final figures. The data can be found in the Haver data bases: PMI and INTSRVYS.

The January "Flash" numbers show increases in the composites: for Germany, from 59.7 in December to 61.0 in January, for France, from 55.3 to 56.9 and for the Euro Area, from 55.0 to 56.3. The index for Germany is close to its pre recession high in June 2006 as can be seen in. the first chart.

Although the Euro Area shows a small gain in the index for manufacturing, from 56.8 in December to 56.9 in January, both Germany and France show declines--Germany from 60.9 to 60.2 and France from 56.3 to 54.3. In spite of the declines, the indexes for both countries are still above the 50 mark, indicating continued expansion, but at a slower rate, as can be seen in the second chart.

The "Flash" estimates for the service indexes were all up enough to offset the declines in manufacturing and result in increases in the composites. For Germany, the Service index rose from 58.3 in December to 60.0 in January, for France, from 54.0 to 57.1 and for the Euro Area, from 53.7 to 55.2. The indexes for the services are shown in the third chart.