Eurozone Manufacturing PMI Rose to a Record High

The eurozone manufacturing PMI rose to 62.4 in March from 57.9, well above 57.9 expectations. This is a record high since June 1997. The services PMI rose to 48.8 from 45.7, beating expectations of 46.1, a 7-month high. The Composite PMI rose to 52.5 from 48.8 to an 8-month high.

Chris Williamson, the chief economist at IHS Markit, said: “The eurozone economy surpassed expectations in March with much better-than-expected growth, driven mainly by record industrial production growth. However, the outlook has deteriorated amid rising COVID-19 infections. Thus, this nature of the economy is likely to persist for some time, as manufacturers benefit from the recovery in global demand, but consumer-oriented service companies remain constrained by social distancing constraints.

Manufacturing PMI in Germany rose to 66.6 in March from 60.7, well above expectations of 60.9. It is also a record high since April 1996. The PMI services rose to 50.8 from 45.7, well above expectations of 46.3. The Composite PMI rose to 56.8 from 51.1, a 37-month high.
Manufacturing PMI in France rose to 58.8 in March from 56.1, higher than the 56.1 forecasts. This is also the highest level in 39 months. PMI Services rose to 47.8 from 45.6, above 45.5 expectations. The Composite PMI rose to 49.5 from 47.0.
US Dollar Stays Firm Despite Upbeat European Data
The greenback continued to rise on Wednesday, with EUR/USD hitting a new 2021 low at 1.1811, despite upbeat data from Europe. The pound also fell, trading throughout the day to 1.3673.

According to preliminary estimates by Markit, business activity in March was surprised with growth in the EU. PMIs from other countries also showed better economic shape for the month, although UK inflation unexpectedly eased in February.

Asian stocks closed lower, reflecting gloomy market sentiment. Nevertheless, European and American indices ended the day in different directions, somehow brushing off negative sentiments. Nevertheless, the dollar retained its strength.