Eurozone's final services PMI to suggest fastest growth for 4 years

The flash euro area services and composite PMIs, published last week, were 54.4 and 54.1 respectively - both at four-year highs, implying the fastest growth in four years. This was primarily driven by strong outstanding business. 

"The final estimate of the euro area services PMI in June 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. Looking at the regional breakdown, German services and composite PMIs should remain unchanged from the flash estimates of 54.2 and 54.0, respectively", estimates Societe Generale. 

Meanwhile the French services PMI is likely to be revised down (from 54.1 to 53.7), i.e. it is still improving but at a slower rate than the first estimate suggests. This is indicated by the slightly weaker-than expected results of the INSEE survey in June, says SocGen.

Societe Generale expects the breakdown of the survey 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.