We started the first trading day of March with data published by IHS Markit, a London-based global information provider. In the data set published by Markit Economics, Manufacturing PMI, which measures the level of activity of purchasing managers in the manufacturing sector in the Eurozone, is the most important data that markets follow.
The Manufacturing Purchasing Managers’ Index in the Eurozone rose 2.71 percent in February to 49.2 points, slightly above market expectations of 49.1, according to data from Markit Economics.
The PMI data hit the highest level since February 2019, and it means that manufacturing output from the locomotive sector of the economy continued to contract but markedly slowed, having not exceeded the threshold level of 50.
We can say that the PMI data, which experienced the strongest decline in 6 years in September 2019 at 45.6 level, showed that the contraction in the manufacturing sector is slowing, especially in 2020. Additionally, the data may lead to the optimistic expectations that it will exceed 50 threshold and indicate the signs of regrowth. However, it is worth noting that this expansion may not be observed directly in the first period ahead due to the adverse effects of coronavirus (COVID-19).
Looking at the one-year performance of the PMI indicator, it is seen that the data, which showed a steady decline until January, headed for a new trend as of this period. We will wait for the data to become permanent above the threshold level of 50 points, in order to talk about expansion in the sector and a positive trend in the PMI indicator.