Divergent Momentums in U.S. and Euro Area Service Sectors

October 5, 2010

Service sector purchasing manager indices printed less than a point apart last month in the United States (53.2) and Euroland (54.3).  The scores signify moderate rates of expansion in both regions, but that’s where any similarity ends.  The U.S. index advanced 1.7 points above the August reading and was 1.2 points better than forecast.  The sub-indices for orders and jobs improved by 2.5 points and 2.0 points.  Euroland’s results were a mirror image of America’s, printing 1.8 points below the August reading and 1.3 points less than anticipated originally.  Activity in Spain (47.9) and Ireland (48.8) contracted, and Italy (51.3) did little better than stagnate.  The momentum in the United States improved, that is expansion rose at a quickening pace, while that in Euroland deteriorated as the rate of expansion slowed.  The minus 0.2 arithmetic sum of the service-sector and manufacturing PMI spreads between the United States and Euroland was the smallest in at least two years, and both differentials were less than a point wide.  But this snapshot may be a case of two ships crossing paths in the night. 

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
May 55.4 56.2 -0.8 59.7 55.8 +3.9 +3.1
June 53.8 55.5 -1.7 56.2 55.6 +0.6 -1.1
July 54.3 55.8 -1.5 55.5 56.7 -1.2 -2.7
August 51.5 55.9 -4.4 56.3 55.1 +1.2 -3.2
Sept 53.2 54.1 -0.9 54.3 53.7 +0.7 -0.2

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

Tags:

ShareThis

This entry was posted on Tuesday, October 5th, 2010 at 8:52 am and is filed under Deeper Analysis. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

Comments are closed.

css.php