Europe’s manufacturing economy continues to rebound while services still droop.
The IHS Markit Purchasing Managers Index (PMI) for Germany’s manufacturing sector climbed to a three-year high of 60.6 in January, up from 57.1 the month before; France’s PMI for the sector added 3.4 points to reach 55.
The pan-European PMI in manufacturing rose from 54.8 to 57.7 for the month.
A rating above 50 signals growth.
In contrast, Germany’s service-sector PMI lost 0.8 points last month to settle at 45.9, a nine-month low. France’s service index lost almost 10 percent, sinking to 43.6, its low point in the last three months.
Europe’s overall service-sector PMI slid 0.7 points, from 45.4 to 44.7.
Europe’s PMI for manufacturing and services combined was 48.1 in January, indicating the prospect of negative growth this quarter after the region’s GDP also shrank last month.
TREND FORECAST: As per the emerging data, and with nations across the continent having been mostly locked down since the COVID War began one year ago, Europe will sink into recession, racking up two consecutive quarters of a negative GDP.
Yes, it will strongly bounce back from low levels in the later spring through autumn, but it will be a temporary boost. Again, we maintain our forecast that economies will stay relatively strong as interest rates stay low and governments keep pumping in artificial stimulus.. money backed by nothing, printed on nothing, further inflates the already over-inflated debt bubble.
But the money-pumping Ponzi scheme will end when the corporate/government debt bubbles burst, interest rates rise, and equity markets crash.
