Bert Colijn, senior economist at ING, notes that the Eurozone’s PMI increased from 51.5 to 51.6 in May, but concerns about manufacturing persist.

“PMI provides relief that the service sector is still going strong in May, but alarm bells continue to sound for the eurozone industry. While the PMI for manufacturing output ticked up from 48 to 49, it’s still indicating a contraction. New orders continued to decline consecutively for the eighth month in a row now, mainly thanks to weak export orders. Expectations for the coming year weakened to the lowest reading since 2014. As the trade conflict between China and the US flares up again, global growth concerns are back on the agenda. On the other hand, postponing car tariffs will provide at least temporary relief to the eurozone industry. For the ECB though, today’s PMI will confirm a slow-growth environment in which inflation is unlikely to accelerate anytime soon.”