European Services Sector Contracted in November

Ibeth Rivero

Europe experiences overall decline in the services sector; Australia's imports and exports surge.

IHS Markit’s final Service Purchasing Managers’ Index (PMI) for Germany signaled a contraction in the services sector, mostly linked to the second lockdown that the government implemented to stop the spread of COVID-19.

The Service PMI stood at 46.0 in November, after being at 46.2 in the previous month and below expectations that it would remain unchanged. The Composite PMI signaled an expansion of the business sector with a reading of 51.7 in November, though this is lower than the previous month's reading of 52 and below expectations that it would remain unchanged.

The United Kingdom's services sector also contracted, though less than expected and at a slower pace. The Service PMI was at 47.6 last month, after being at 45.8 in the previous month. Analysts had expected it to remain unchanged. France's Service PMI also decreased with a Service PMI reading of 38.8, though this was higher than expected and surpassed the previous month's figure.

The European Union's services sector also contracted in November with a Service PMI reading of 41.7. The figure was higher than the previous month's 41.3, and challenged forecasts that it would remain unchanged. The EU's Composite PMI signaled a contraction of its business sector, with a reading of 45.3.

By 9:45 GMT, the euro dropped by 0.10 percent against the US dollar, falling to the 1.2103 level. The pound sterling gained 0.22 percent against the greenback, falling to the 1.3392 level.

Australia's Imports and Exports Surge

The Australian Bureau of Statistics recently reported that October's trade balance was at A$7,456 million, rising above the previous month's A$5,815 million and surpassing expectations of A$5,800 million.

Imports surged by 0.6 percent, improving from the previous month's 6.5 percent contraction. In a similar vein, exports climbed by 5.4 percent, after an increase of 2.6 percent in the previous month.

By 9:55 GMT, the Australian dollar gained 0.05 percent against the greenback, hitting the 0.7419 level.

Ibeth Rivero

Ibeth contributes daily market commentary in both English and Spanish (both of which she speaks fluently) and she also manages the DailyForex mobile app to ensure that traders around the world are getting important market updates in real time.

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