Market movers today
We start out the week with a lot of preliminary activity indicators for April, before attention later this week turns to the ECB meeting on Thursday as well as the US preliminary GDP numbers for Q1.
In the euro area, the PMI figures will be released today. Manufacturing PMI declined throughout Q1 18, from 60.6 in December 2017 to 56.6 in March 2018. We believe a further decline to 55.5 is pending for April. Several survey indicators have pointed to lower optimism, fear of a trade war and the euro appreciation last year is starting to show its impact on activity. Similarly, Service PMI declined to 54.9 in March since peaking at 58.0 in January. We believe Service PMI is set for a further decline to 54.3 in April.
In the US, Markit PMIs are due for release on Monday. Empire regional PMIs fell in March which points to a slowdown in manufacturing sector. The gap between ISM and Markit PMI manufacturing remains a mystery, although we consider ISM to have come in at a too high level. We believe both indices will fall over the coming months. Markit service PMI fell in February but we estimate it increased slightly in March from 54 up to 55.
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