Eurozone: PMIs remain below 50 and the EUR/USD below 1.10 – Nordea

Deep contraction in economic activity continued in May, according to the flash Euro area PMI, which remained far below the 50-mark in May, per Nordea. The EUR/USD paid little heed to the Eurozone PMI readings.

Key quotes

“A rise from 13.6 in April to 30.5 in May implies less deep contraction compared with April’s lockdowns, but readings must exceed the 50-mark in the coming months to point to a ‘re-opening’ and a return towards more normal economic activity levels. The coming months should see very high PMIs.”

“The composite PMI in Germany bounced back to 31.4 from 17.4 in April. Activity in both manufacturing (36.8) and services (31.4) continued to fall in May albeit at a slower pace than in April, as the readings remained firmly below 50.” 

“The French composite PMI increased to 30.5 from 11.1 in April as businesses turned a little less pessimistic. The slowing decrease in activity was driven by increased readings in both the manufacturing (40.3) and service sectors (29.4).”