What a difference a few days can make to the economic climate of an area! Since the turn of the year, the eurozone’s economic data releases have been faintly underwhelming and built a picture that appeared at odds with the European Central Bank’s economic projections. However, yesterday provided cause for optimism, with two PMI data releases that came in way above expectations.
German construction PMI for May had been predicted to come in at 51.5 from 50.9 the month before, but the figure was actually 53.9. It is the strongest pace of expansion in the construction sector since January. Retail PMI in the eurozone also strengthened significantly, by coming in at 51.7 in May from 48.6 the month before. The releases were enough to boost the euro, which climbed higher against sterling and the dollar.
Today’s main release is the third estimate of the eurozone’s GDP growth rate for the first quarter of 2018. Quarter-on-quarter it is expected to come in at 0.4% from 0.7% in the fourth quarter, while year-on-year, 2.5% growth is forecast from 2.8%.
