Investing.com – Euro zone private sector activity lost momentum for the second month running in July, but still started the third quarter on a solid footing, according to data released on Monday.
The preliminary reading of the Markit manufacturing purchasing managers’ index came in at this month from 57.4 in June.
Economists had expected a reading of 57.2.
The services PMI was unchanged from a month earlier at , compared to expectations for a reading of 55.5.
The composite output index, which measures the combined output of both the manufacturing and service sectors declined to a six-month low of from 56.3 in June, compared to expectations for 56.2.
Despite coming off recent highs, the index remained at an elevated level by historical standards and signalled one of the strongest expansions seen over the past six years
A reading above 50.0 on the index indicates industry expansion, below indicates contraction.
“The July fall in the PMI indicates that the euro zone’s recent growth spurt lost momentum for a second successive month, but still remained impressive,” said Chris Williamson, Chief Business Economist at Markit.
“The survey data are historically consistent with GDP rising at a quarterly rate of 0.6%, cooling slightly from a pace of over 0.7% signalled for the second quarter.”
“The slowing pace of economic growth signalled by the surveys and the accompanying easing of price pressures adds to the belief that ECB policymakers will be in no rush to taper policy, and will leave all options open until the central bank sees a clearer picture of the sustainability of the upturn.”
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