The French PMI turned out to be overall much lower than anticipated, with the Manufacturing industry falling to a 19-month low of 51, which is barely in the expansionary area where contractionary territory starts below 50. As a result, the noticeable downturn at the end of Q2 has caused growth to weaken to its lowest level since the peak Omicron disruption, pushing the composite number to a 5-month low.
There was yet another disappointing set of numbers, with the most recent German PMI numbers also coming below the expectations set forth, adding to the perception that the Eurozone is losing momentum swiftly. Additionally, the manufacturing sector’s 23-month low raises concerns about the Euro Area’s potential for a recession.
The Euro is under pressure as a result of the weak set of PMI numbers, testing the 1.05 mark on the negative after retreating from the 1.05s high. In the meantime, as markets unravel bets on the European Central Bank (ECB) tightening, the yield on the German 10-year bond has increased and fallen as much as 14 basis points.
