Great Graphic: Eurozone Output PMI and GDP

It is not really clear yet whether the recession in the euro area has really ended.  The rule-of-thumb definition of a recession as two consecutive quarters of negative growth is not very helpful and, in fact, is not used by the official arbiter in the US. 

This Great Graphic from Markit Economics shows the fit between the output index of the composite PMI and GDP.  German strength may be again obscuring weakness elsewhere.   While Spain's Nov output reading was the best in three months, the details are really more mixed.  As we learned earlier this week, the November manufacturing PMI fell to 48.6 from 51.1.  Today we learned that the service sector PMI rose to 51.5 from 49.7.

The divergence between Germany and France is notable and will likely be an increasing source of stress.  The premium France pay over Germany on 10-year money has narrowed about 2 bp today to 60 bp, but the spread is still the largest in nearly 3-months.  It has widened by about 13 bp over the past week. 
Great Graphic: Eurozone Output PMI and GDP Great Graphic:  Eurozone Output PMI and GDP Reviewed by Marc Chandler on December 04, 2013 Rating: 5
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