Euro-zone Manufacturing PMI Slips to 51.8 in June; Not at Full Year of Growth (FXE)

Guggenheim CurrencyShares Euro Trust (NYSE: FXE) is on watch today following new eurozone manufacturing growth data.

Markit reported that final Manufacturing Purchasing Managers' Index (PMI) fell to 51.8 last month, from 52.2 in May and the lowest mark since last November. The final figure compares with a preliminary reading of 51.9.

Reading above 50 indicate growth in a segment. The Markit Manufacturing PMI has been above that level for a year.

New business showed slower growth than in May and the Backlogs of Work index moved from 49.6 down to 49.5.

Markit commented, National PMI readings improved in Ireland and Spain, reaching a two-month high in the former and a seven-year record in the latter. PMI indices fell in all of the other nations, although only France and Greece signalled outright contractions. National PMI readings improved in Ireland and Spain, reaching a two-month high in the former and a seven-year record in the latter. PMI indices fell in all of the other nations, although only France and Greece signalled outright contractions Germany (nine-month low), Italy, Ireland (both four-month lows), the Netherlands (11-month low) and Greece (three-month low).

Underlying the slower expansion of production was a weaker increase in new orders. Although new business inflows rose at the slowest pace since October 2013, this nonetheless extended the current upturn in new order volumes to 12 months.

Domestic market conditions remained generally subdued, according to companies, while levels of new export business rose at the least marked pace for almost a year. France posted the worst performance, with concurrent contractions of new orders and new export business registered for the second straight month. Moreover, the rates of contraction were the sharpest during the year-to-date in both cases.

Austria also reported declines in both total and export demand, while total new orders stagnated in Greece despite an increase in new export business. Growth of new orders meanwhile slowed in Germany, Italy and the Netherlands, but accelerated sharply in Ireland and Spain.

Manufacturing employment rose for the sixth successive month in June, although the rate of growth remained only marginal. France reported job cuts for the third straight month, while a reduction was also registered in Greece and staffing levels were broadly unchanged in Germany and Austria. Job creation slowed in almost all of the remaining nations, the notable exception being Spain – which reported the strongest increase since July 2007.

Input costs rose for the first time in five months in June, in some cases reflecting recent oil price increases. With costs showing a modest gain, manufacturers raised their average selling prices for the second month in a row. However, rates of increase in purchase prices and output charges were only modest. Supplier delivery times lengthened for the twelfth month in a row, and to the greatest extent since June 2011.

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