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Economy in Brief

EMU PMIs Continue to Advance in Services
by Robert Brusca  October 3, 2013

The EMU services PMI rose to 52.18 in September from 50.69 in August. This marks only the second month in a row that the EMU service sector is expanding. Previously January 2012 was the last observation above 50.

At this level the EMU reading stands in the 45.6 percentile of tis ordered queue of historic values. It has been higher 55% of the time and lower about 45% of the time. That's not a great reading.

Germany imparts a strong positive bias to the EMU reading because of its heavy weighting. Germany's index stands at 53.69 and resides in the 63rd percentile of its historic queue a relatively more solid standing. Germany's service sector reading averages above 50 for 3-months, 6-months and 12-months. Only tiny Ireland and the UK can match that.

The UK service sector edged slightly lower on the month but still resides at an incredible 98th percentile of tis historic queue.

The EU commission readings for the service sector in EMU are weak as that reading stands only in the 30th percentile of its historic queue (we evaluate its net EU Commission readings using the queue method for compatibility between the two methods diffusion methods).

Consumer confidence percentile standings are generally the same as service sector readings or a bit higher.

The monthly report on services shows gain for EMU but still great differences within the Zone. Every country in the table shows improvement over three-months compared to six months. All but the UK and Spain are better off in Sept than their respective 3-mo averages. Only Germany fails to show a better 6-mo average than 12-mo average.

So progress continues in the Zone and in these member countries' services sectors. Progress however is slow and the stratification among members continues to be a dividing point.

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