Eurozone: PMIs and Draghi in focus - TDS

In view of analysts at TDS, flash PMIs for August in addition to the ECB President Draghi’s speech at Jackson Hole are going to be the key events as far as Eurozone is concerned.

Key Quotes

“With the most recent ECB minutes expressing concern over the possibility of an overshoot in the EUR, we’ll be watching for any indication that the latest leg higher in the EUR is starting to worry the manufacturing sector in particular. We look for the German manufacturing PMI to edge another point or so lower, falling to 57.0 (mkt 57.6), making for the sharpest two-month fall since early 2016. We’re closer to consensus for French services, looking for a steady reading of 56.0 (mkt 55.8).”

“Also this morning, ECB President Draghi speaks at 8am BST as he gives the keynote speech at the Lindau meeting on economic sciences. While Jackson Hole on Friday is the bigger focus for markets, this morning will be Draghi’s first chance to update his thinking since last month’s ECB meeting. If he does have any inclination to push back against the recent strength in the EUR, we think that he’s probably more likely to do so here than at Jackson Hole later this week, but that either way, he’s highly unlikely to say anything at this stage about tapering in 2018.”