Latest data released by Markit/BME - 3 June 2020

  • Prior 16.2
  • Composite PMI 32.3 vs 31.4 prelim
  • Prior 17.4

The preliminary release can be found here. A slight revision higher to initial estimates but all this does is reaffirm that business activity has improved from April to May, but the overall outlook remains bleak as demand conditions remain highly subdued.

Markit highlights that underlying data showed further decreases in activity across five of the six broad services sub-sectors with the only exception being an improvement in 'hotels and restaurants' but even then it was barely significant. Markit adds that:

"The PMI data have so far largely been in line with expectations, with April representing the trough of the economic contraction, followed by an easing of the downturn in May as more businesses resumed operations. However, the data show that there is still considerable slack in the economy, and point to the real possibility of a double-digit contraction in the second quarter.

"As such, disinflationary forces still are looming large over the private sector economy, with fierce competition among businesses driving down prices charged for goods and services. Lower costs have so far helped facilitate discounting, however.

"There was more bad news for the German labour market in May as job losses continued to mount. Staff cuts were initially centred on services at the start of lockdown, but here the rate of decline has eased slightly and now been overtaken by manufacturing."