German manufacturing PMI fell to 41.4 in September, down from 43.5 in the previous month and missing expectations of 44. This is the ninth consecutive month of contraction in factory activity and has caused the euro to fall against both the pound and the dollar. German composite PMI, which combines services and manufacturing, has fallen into contraction for the first time since 2013, dropping to 49.1.
Hopes are up that Brexit negotiations may be slowly progressing towards a deal, after Jean-Claude Juncker said that he was open to other possibilities than the Irish backstop in the Withdrawal Agreement. Reports today are conflicting on whether progress really is happening or not, so we can expect plenty more uncertainty coming up.
Today is a busy day for data, after a quiet week last week. We will see services PMI, Spanish balance of trade and then, later this afternoon, a speech from Mario Draghi and the Bundesbank’s Mauderer.
