Final Euro area services PMI to suggest fastest growth in sector for 4 years

The flash euro area services and composite PMIs, published last week, implies the fastest growth in four years. 

The breakdown of the survey is expected to show a similar picture as the flash estimate with expectations of future growth falling (lower new business) due to high uncertainty and market volatility whereas input cost pressure remain muted, on the back of low wage growth

This was primarily driven by strong outstanding business. "The final estimate of the euro area services PMI in June is expected to tick up from 54.4 (flash) to 54.5. Similarly, the composite PMI is likely to be revised upwards from 54.1 (flash) to 54.2", says Societe Generale.

"Looking at the regional breakdown, German services and composite PMIs should remain unchanged from the flash estimates of 54.2 and 54.0, respectively. Meanwhile the French services PMI is likely to be revised down, i.e. it is still improving but at a slower rate than the first estimate suggests", added Societe Generale. 

This is indicated by the slightly weakerthanexpected results of the INSEE survey in June.