· The NTC MFG and Services indices for the E-zone slipped in December in their flash release. Services are below their three month and six month and 12-month average values.
Manufacturing is too, except for the three month comparison. The Service index stand in the bottom of its
24 month range. For the same period Manufacturing is in the bottom 16 percent of its range. Although the
manufacturing index has a much longer history and in its full sample of observations (back to June 1997) it resides in the 54th percentile of its range and
it is just 0.5% below its long term average reading.· The Flash data show us that the Euro Area is still weak and losing momentum. But the chart also shows that the momentum loss is not accelerating. Services continue to look bad in terms of momentum, but manufacturing fell and bounced and is now eroding at a much more moderate pace.