Despite expectations of an improvement, French purchasing manager's index (PMI) flash estimates have worsened in July. That's set the euro down against the dollar.
It looks like $EURUSD was knocked back about 25 pips from 1.3350 by the French PMI preliminary release.— DailyFXTeamMember (@DailyFXTeam) August 22, 2013
The manufacturing number stays steady at 49.7, versus expectations of a rise to 50.2 (any number below 50 implies the sector is contracting).
Worse news is found in the services numbers, as PMI declines from 48.6 to 47.7. Economists had been forecasting a jump to 49.2.
Jack Kennedy, senior economist at Markit, said:
Although output fell at a sharper pace in August, the rate of decline remained much slower than seen earlier in the year. Weakness in activity and employment was broad-based across the services and manufacturing sectors, with moderate falls signalled in each case.
However, there were encouraging signs from some of the more forward-looking indicators, such as a slight rise in manufacturing new orders for the first time in over two years and service providers’ confidence holding steady on July’s 11-month high.
again...the waning predictive power of PMI on French GDP pic.twitter.com/K3yd7fvaK2— econhedge (@econhedge) August 22, 2013