Eurozone manufacturing and services PMIs decline but remains strong
Eurozone services and manufacturing sector growth remained strong in early July, though surveys on sectors were both slightly less than expected on Monday.
A preliminary, or 'flash', euro area manufacturing purchasing managers' index for July showed a slight easing back to 56.8 from 57.4 in June, falling short of the consensus forecast of 57.2.
The eurozone manufacturing PMI was at its lowest since January, but still well up on the 50.0 reading that separates growth from contraction.
The eurozone services PMI for July, also produced by Markit, remained at 55.4 for a second month, though the market had expected it to improve slightly to 55.5.
The headline composite PMI declined to 55.8 from 56.3, below the consensus forecast of 56.2.
Economists said the composite PMI looks consistent with quarterly gross domestic product growth of about 0.6% for the eurozone.
Separate individual country reports showed Germany and France's PMIs fell to seven-month lows.
The German PMI index easing to 55.1 from 56.1, after what seemed a very strong second quarter, while the French reading fell to 55.7 from 56.6.
"In all, the euro-zone PMI suggests that the economy grew at a decent pace at the beginning of Q3, which if sustained should make the ECB more comfortable about tapering its asset purchases in the first half of next year," said Jack Allen at Capital Economics.
"But with inflationary pressure still subdued, as signalled by the PMI input and output price indices, we still think that it will leave interest rates at their current levels until 2019."
Elsewhere on Monday, the IMF revised its global GDP forecasts for 2017, upgrading Germany by 0.2 points to 1.8%, France by 0.1 points to 1.5%, while Italy and Spain were both shifted up 0.5 points to 1.3% and 3.1% respectively.
Despite downgrading the US and UK, the IMF held its prediction for the global economic growth of 3.5% for 2017 and 3.6% in 2018, driven by China, Japan and the EU.