There have been two big economic stories during the European downturn.
1) The European economy has been a horror show.
2) Somehow, Europe’s biggest “locomotive,” Germany, always seems to come through.
And just when it looked like Germany was about to crack… this happens.
German PMI numbers jump. There was a very nice number in today’s services report. Here’s a summary from Markit:
Meanwhile, despite the fact that all of Germany’s immediate neighbours are weak, the country benefits by being a global export powerhouse, and here there is again a shift in its advantage, as there are signs of global trade picking back up (being seen everywhere from China to Korea to Brazil). Here’s a key chart from SocGen:
So just when it looked like Germany might get sucked into the vortex… here they come again.