The rosy eurozone growth estimates of a few months ago have bitten the dust already with the possible exception of Germany.
The Markit Flash Eurozone PMI signals slowing growth for second successive month in November, with France leading the way.
- Flash Eurozone PMI Composite Output Index at 51.5 (51.9 in October). Three-month low.
- Flash Eurozone Services PMI Activity Index at 50.9 (51.6 in October). Three-month low.
- Flash Eurozone Manufacturing PMI at 51.5 (51.3 in October). 29-month high.
- Flash Eurozone Manufacturing PMI Output Index at 52.8 (52.9 in October). Two-month low.
At 51.5, down from 51.9 in October, the flash estimate of the Markit Eurozone PMI ® Composite Output Index remained above the 50.0 no-change level for a fifth successive month in November, but signalled a modest easing in the rate of expansion for the second month running.
Output growth in manufacturing stabilised at a robust rate and remained stronger than service sector expansion, which eased to the weakest since August. Trends were also varied by country. The composite PMI covering both manufacturing and services in Germany rose to its highest since January, signalling increasingly robust growth and a seventh successive monthly expansion.
In contrast, the comparable index for France fell to its lowest since June, signalling a renewed decline after just two months of fractional growth. Elsewhere across the region, output rose for the fourth month in a row, but the rate of increase was the weakest seen over that period.
Private sector employment in the eurozone fell for the twenty-third consecutive month, with the rate of job losses accelerating marginally for the second successive month. Manufacturers reported the smallest drop in payroll numbers since July, while employment in the services sector fell at the strongest rate since August . By country, staffing numbers rose for the third time in five months in Germany, but fell at the steepest rate for six months in France. Elsewhere, the rate of job shedding eased to the second-lowest seen for over two years.
Chris Williamson, Chief Economist at Markit Comments
Some encouragement must be gleaned from the PMI signalling expansion of the eurozone economy for a fifth successive month in November, but the average reading over the fourth quarter so far is signalling a very modest 0.2% expansion of GDP across the region, and it looks like momentum is being lost again.
Any improvements were largely confined to Germany, where the PMI has notched up the best growth since mid – 2011 so far in the fourth quarter, signalling a 0.5% increase in GDP. France, on the other hand, showed further signs of being the ‘sick man of Europe‘ with output showing a renewed decline and raising the risk that GDP could fall again in the fourth quarter, constituting a renewed recession. Meanwhile growth outside the ‘big two’ slowed to near-stagnation.
Core vs. Periphery Output
Mike “Mish” Shedlock