U.S. Minus Euroland Services Spread Narrowed Last Month

May 5, 2010

Implied activity in the United States service sector remained brisk last month but failed to quicken further.  This allowed it to be overtaken marginally by Euroland’s index and caused the spread between the sum of the services and manufacturing PMIs, depicted below in the right-most column to drop to 2.6 from 4.3.  The U.S. subindex for service-sector orders dropped back 4.1 points to 58.2, whereas Euroland orders for services reached their best level since October 2007.  Euroland’s improvement was led by a 5.4 point increase in the French PMI and a 1.4 point rise in the Irish index.  The service PMIs in Italy and Spain fell but at least remained above 50, thus connoting slower but still positive rates of growth.

PMIs U.S. Ezone   U.S. Ezone   Sum of
  Services Services Spread Mf’g Mf’g Spread Spreads
Feb 2009 42.1 39.2 +2.9 35.7 33.5 +2.2 +5.1
March 41.2 40.9 +0.3 36.4 33.9 +2.5 +2.8
April 43.9 43.8 +0.1 40.4 36.8 +3.6 +3.7
May 44.5 44.8 -0.3 43.2 40.7 +2.5 +2.2
June 46.3 44.7 +1.6 45.3 42.6 +2.7 +4.3
July 46.7 45.7 +1.0 49.1 46.3 +2.8 +3.8
August 48.2 49.9 -1.7 52.8 48.2 +4.6 +2.9
Sept 50.1 50.9 -0.8 52.4 49.3 +3.1 +2.3
October 50.1 52.6 -2.5 55.2 50.7 +4.5 +2.0
November 48.4 53.0 -4.6 53.7 51.2 +2.5 -2.1
December 49.8 53.6 -3.8 54.9 51.6 +3.3 -0.5
Jan 2010 50.5 52.5 -2.0 58.4 52.4 +6.0 +4.0
Feb 53.0 51.8 +1.2 56.5 54.2 +2.3 +3.5
March 55.4 54.1 +1.3 59.6 56.6 +3.0 +4.3
April 55.4 55.6 -0.2 60.4 57.6 +2.8 +2.6

Copyright Larry Greenberg 2010.  All rights reserved.  No secondary distribution without express permission.

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