Manufacturing PMI for the month of May is not very suggestive that Q1's softness is transitory or temporary
The prints today were neither too underwhelming nor were they decent. Relative to April figures, all major economies in the Eurozone showed a decline in the manufacturing PMI print except for France.
The Eurozone final reading came in similar to the preliminary reading, but the trend is not looking good. And the details aren't too comforting either.
The market may be focused on more macro themes such as Italy and the trade rhetoric for now, but this kind of sluggishness is what is going to influence the ECB in terms of how confident the central bank will be to communicate normalising monetary policy.
Now that it's almost certain Q2 will remain soft in terms of growth, the real question is how much will this feed into 2H 2018. With prospects of a global trade war looming, the signs aren't looking too good.
Do you see a trend with how the PMI readings have been going this year? ;)
