U.S. Economic Advantage versus Euro Area Widens for Fifth Straight Month
August 5, 2014
Euroland’s service-sector PMI increased 1.4 points to 54.2 in July. Since the U.S. comparable PMI rose nearly twice as much, however, the differential between the two indices widened 1.3 points to +4.5, and such was 5.5 points better than the spread of -1.0 in February. In conjunction with a 1.8-point widening of the manufacturing PMI spread to 5.3 points, the sum of the two spreads increased 3.1 points to +9.8, indicating the strongest U.S. advantage in 11 months.
Among the components of the U.S. services PMI, sales rose 4.9 points to 62.4, orders went up 3.7 points to 64.9 and jobs increased 1.6 points to 56.0. Interestingly, the Markit Economics estimate of the U.S. PMI dipped 0.2 points in July, but the table below and commentary above reflect data reported by the Institute of Supply Management.
The German services PMI (up 2.1 points to 56.7) and the French index (up 2.2 points to 50.4 in July) improved more sharply than the Euroland index, but Italy’s PMI dropped by 1.1 points to 52.8. Spain, like the overall Ezone, experienced a 1.4-point rise in its services PMI, which printed at 56.2 for July.
| PMIs | U.S. | Ezone | U.S. | Ezone | Sum of | ||
| Services | Services | Spread | Mf’g | Mf’g | Spread | Spreads | |
| Jan 2012 | 56.8 | 50.4 | +6.4 | 54.1 | 48.8 | +5.3 | +10.9 |
| Feb | 56.1 | 48.8 | +7.3 | 51.9 | 49.0 | +2.9 | +10.2 |
| March | 55.0 | 49.2 | +5.8 | 53.3 | 47.7 | +5.6 | +11.4 |
| April | 53.7 | 46.9 | +6.8 | 54.1 | 45.9 | +8.2 | +15.0 |
| May | 54.1 | 46.7 | +7.4 | 52.5 | 45.1 | +7.4 | +14.8 |
| June | 52.7 | 47.1 | +5.6 | 50.2 | 45.1 | +5.1 | +10.7 |
| July | 52.9 | 47.9 | +5.0 | 50.5 | 44.0 | +6.5 | +11.5 |
| August | 54.3 | 47.2 | +7.1 | 50.7 | 45.1 | +5.6 | +12.7 |
| Sept | 55.2 | 46.1 | +9.1 | 51.6 | 46.1 | +5.5 | +14.6 |
| October | 54.8 | 46.0 | +8.8 | 51.7 | 45.4 | +6.3 | +15.1 |
| November | 54.8 | 46.7 | +8.1 | 49.9 | 46.2 | +3.7 | +11.8 |
| December | 55.7 | 47.8 | +7.9 | 50.2 | 46.1 | +4.1 | +12.0 |
| Jan 2013 | 55.2 | 48.6 | +6.6 | 53.1 | 47.9 | +5.2 | +11.8 |
| February | 54.8 | 47.9 | +8.1 | 53.1 | 47.9 | +5.2 | +13.3 |
| March | 54.5 | 46.4 | +8.1 | 51.5 | 46.8 | +4.7 | +12.8 |
| April | 53.8 | 47.0 | +6.8 | 50.0 | 46.7 | +3.3 | +10.1 |
| May | 54.0 | 47.2 | +6.8 | 50.0 | 48.3 | +1.7 | +8.5 |
| June | 53.4 | 48.3 | +5.1 | 52.5 | 48.8 | +3.7 | +8.8 |
| July | 55.9 | 49.8 | +6.1 | 54.9 | 50.3 | +4.6 | +10.7 |
| August | 57.9 | 50.7 | +7.2 | 56.3 | 51.4 | +4.9 | +12.1 |
| Sept | 54.5 | 52.2 | +2.3 | 56.0 | 51.1 | +4.9 | +7.2 |
| October | 55.1 | 51.6 | +3.5 | 56.6 | 51.3 | +5.3 | +8.8 |
| November | 54.1 | 51.2 | +2.9 | 57.0 | 51.6 | +5.4 | +8.3 |
| December | 53.0 | 51.0 | +2.0 | 56.5 | 52.7 | +3.8 | +5.8 |
| Jan 2014 | 54.0 | 51.6 | +2.4 | 51.3 | 54.0 | -2.7 | -0.3 |
| February | 51.6 | 52.6 | -1.0 | 53.2 | 53.2 | 0.0 | -1.0 |
| March | 53.1 | 52.1 | +1.0 | 53.7 | 53.0 | +0.7 | +1.6 |
| April | 55.2 | 53.1 | +2.1 | 54.9 | 53.4 | +1.5 | +3.6 |
| May | 56.3 | 53.2 | +3.1 | 55.4 | 52.2 | +3.2 | +6.3 |
| June | 56.0 | 52.8 | +3.2 | 55.3 | 51.8 | +3.5 | +6.7 |
| July | 58.7 | 54.2 | +4.5 | 57.1 | 51.8 | +5.3 | +9.8 |
Copyright 2014, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
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