An April Setback to Recent Convergence of U.S. and Eurozone Economies
May 6, 2015
Four four straight months between November through March, the manufacturing and service-sector purchasing manager differentials of the United States and Euroland had diminished, but each widened last month. In manufacturing, whose PMI spread had swung from +7.5 points to -0.7 points, April’s reversal in trend was very marginal to -0.5 points. But in services, the spread rose 1.4 points to +3.7 points as the U.S. PMI improved 1.3 points to a 5-month high of 57.8, while its eurozone counterpart edged 0.1 point lower to a 2-month low of 54.1.
In the U.S. report, business activity/production rose 4.1 points to 61.6, while new business improved 1.4 points to 59.2. Prices fell 2.3 points in April, and jobs were barely changed from the prior month’s score.
Service-sector PMI readings in the eurozone ranged from 60.6 in Ireland to 603 in Spain, 54.0 in Germany, 53.1 in Italy and 51.4 in France. Spain’s score was at a 101-month high, while Ireland’s was at a 14-month low. The eurozone data seem to imply GDP trending upward at about a 0.4% quarterly pace at the start of the second quarter. The data also reveal lessening downward pressure on prices.
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 | 52.5 | 52.6 | -0.1 | 54.3 | 53.2 | +1.1 | +1.0 |
March | 53.7 | 52.1 | +1.6 | 54.4 | 53.0 | +1.4 | +3.0 |
April | 55.3 | 53.1 | +2.2 | 55.3 | 53.4 | +1.9 | +4.1 |
May | 56.1 | 53.2 | +2.9 | 55.6 | 52.2 | +3.4 | +6.3 |
June | 56.3 | 52.8 | +3.5 | 55.7 | 51.8 | +3.9 | +7.4 |
July | 57.9 | 54.2 | +3.7 | 56.4 | 51.8 | +4.6 | +8.3 |
August | 58.6 | 53.1 | +5.5 | 58.1 | 50.7 | +7.4 | +12.9 |
Sept | 58.1 | 52.4 | +5.7 | 56.1 | 50.3 | +5.8 | +11.5 |
October | 56.9 | 52.1 | +4.8 | 57.9 | 50.6 | +7.3 | +12.1 |
November | 58.8 | 51.1 | +7.7 | 57.6 | 50.1 | +7.5 | +15.2 |
December | 56.5 | 51.6 | +4.9 | 55.1 | 50.6 | +4.5 | +9.4 |
Jan 2015 | 56.7 | 52.7 | +4.0 | 53.5 | 51.0 | +2.5 | +6.5 |
February | 56.9 | 53.7 | +3.2 | 52.9 | 51.0 | +1.9 | +5.1 |
March | 56.5 | 54.2 | +2.3 | 51.5 | 52.2 | -0.7 | +1.6 |
April | 57.8 | 54.1 | +3.7 | 51.5 | 52.0 | -0.5 | +3.2 |
Copyright 2015, Larry Greenberg. All rights reserved. No secondary distribution without express permission.