In the first half of the day, the data released on the production sector in a number of eurozone countries had a negative impact on the buyers of the European currency, which led to a certain decrease in risky assets. The slowdown in the growth rate of production activity reflects the general situation in the euro zone economy, the pace of recovery which began to slow down at the beginning of this year.
According to the agency of statistics, the index of supply managers PMI for the manufacturing sector of Italy in March this year was at 55.1 points against 56.8 points in February, indicating a slowdown in growth. The industrial PMI of Italy was projected at 55.5 points.
In France, the situation is similar. The index of supply managers PMI for the manufacturing sector in March showed an increase to 53.7 points against 55.9 points in February, while economists predicted it at 53.6 points.
The weak general growth of the industrial production index in the eurozone is not surprising, even after a drop in this index even in Germany. According to the report of the statistics agency, the index of supply managers PMI for Germany's manufacturing sector in March 2018 dropped to 58.2 points against 60.6 points in February, when a record high was reached. Economists predicted a production PMI of Germany at 58.4 points.
In general, in the euro area, the purchasing managers' index rose to 56.6 points in March against 58.6 points in February. The production PMI of the eurozone was predicted at 56.6 points.
In addition to everything else, today there were rumors that the ECB could warn British companies that they can not expect a Brexit transitional deal in terms of trade with the EU. According to the regulator, the most optimal scenario is the lack of agreement on the transaction. This directly contradicts the recent statement of the Bank of England, which said that the conditions will not change for the entire period of the alleged Brexit, until the end of 2020.
The British pound also lost ground after more than a slight increase in the PMI supply managers index for the UK manufacturing sector, which in March was only 55.1 points, compared to 55 points in February. Economists predicted the UK manufacturing PMI at 54.4 points. Let me remind you that the value above 50 points indicates an increase in activity.
As noted in the company IHS Markit, which prepares reports, production growth in the manufacturing industry accelerated, although this acceleration was offset by a slowdown in the growth of new orders. Purchasing prices remained high, but the growth in production costs slowed.
