Euro area preliminary services PMI likely to have remained unchanged in September

The preliminary September release of the euro area PMI is set to be released tomorrow. The manufacturing PMI for the month of August had come in below consensus expectations and dropped slightly to 54.6, while the services PMI had risen to 54.4. Services represent a huge share of the euro area economy, so the uptick last month might be a positive sign for strengthening overall economic growth if the trend continues in the months ahead.

For now, subdued economic growth in the euro area in 2018 has underpinned the ECB’s continued accommodative monetary policy stance. The European Central bank has hinted that it must first wrap up its bond purchasing program at the end of 2018 before raising rates, and interest rates are unlikely to start hiking until fall of 2019, noted Wells Fargo in a research report. Meanwhile, policymakers might keep a close watch on tomorrow’s PMI releases for signs of a likely rebound in economic growth. According to consensus expectations, services PMI is expected to have remained the same, while the manufacturing PMI is expected to have dropped marginally.

At 13:00 GMT the FxWirePro's Hourly Strength Index of Euro was neutral at 49.9153, while the FxWirePro's Hourly Strength Index of US Dollar was neutral at -37.9697. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex