Latest data released by Markit - 21 May 2020

  • Prior 12.0
  • Manufacturing PMI 39.5 vs 38.0 expected
  • Prior 33.4
  • Composite PMI 30.5 vs 27.0 expected
  • Prior 13.6

Once again, the rebound in the services and composite readings mainly reaffirms a shift in the balance of businesses reporting that business conditions in May are better than April; it doesn't really tell us what these "better conditions" really mean.

Meanwhile, manufacturing activity also picked up slightly but remains highly subdued as output continues to decline further - albeit less slowly than last month.

Markit notes that:

"The eurozone saw a further collapse of business activity in May but the survey data at least brought reassuring signs that the downturn likely bottomed out in April.

"Second quarter GDP is still likely to fall at an unprecedented rate, down by around 10% compared to the first quarter, but the rise in the PMI adds to expectations that the downturn should continue to moderate as lockdown restrictions are further lifted heading into the summer.

"All eurozone countries eased their COVID-19 containment measures to some extent in May, helping to moderate the overall rate of economic decline.

"However, while a further loosening of restrictions is anticipated in coming months, some measures to contain the virus are likely to remain in place until an effective treatment or vaccine is found.

"An additional concern is that demand is likely to remain extremely weak for a prolonged period, putting further pressure on companies to make more aggressive job cuts as government job retention schemes expire. We therefore expect GDP to slump by almost 9% in 2020 and for a full recovery to take several years."

The full report can be found here.