The latest release on business growth in the single currency remained soft for the previous month, showing undoubted evidence that the strong expansion at the beginning of the year has already lost its pace. Also, ultra-loose monetary policy rate left unchanged by the European Central Bank on Thursday is pushing companies still cut its prices in May, as they have done for at least five years. Meanwhile, the Euro zone services PMI advanced to 53.3 from 53.1 reported in the preceding month and the composite went up to 53.1 from 52.9. The following data shows, that services reading improved slightly over the month, and continue to show its amelioration, versus a slight deceleration suggested by the initial numbers.
In the meantime, national EU data was mixed. The Italian services PMI returned back into contraction phase at just 49.8 while the overall composite Italian PMI is hardly holding above the major line at 50.8 is worrying. The French readings also were revised down, however, German and Euro zone data, in turn, were revised higher. Overall, high uncertainty and gloomy forecasts remains on the market, while additional disappointing releases could lead to the additional concerns over the ECB's failure to announce new measures.