(Kitco News) - Services PMIs from the major nations have not made for the best of readings this morning. Most of the readings have missed against expectations or are below previous readings which could indicate a global contraction. Starting with the U.K. the services sector is the biggest contributor to GDP and the PMI reading for July hit 52.6 vs 53.3 expected. Although this is still above the 50 expansionary figure it is worse than last month's figure. The report said it was the slowest output growth in 17 months and inflationary pressures and
the cost-of-living squeeze resulted in heightened economic uncertainty expansion.
In Europe, PMI Services Business Activity Index posted 51.2 in July, down from 53.0 in June. The PMI report noted "For the first time since April 2021, incoming new business at eurozone services firms fell. Panel members frequently commented on higher prices as a reason for lower demand. New business from overseas clients also fell, with the decline gathering pace to the quickest since March 2021."
In terms of a market reaction, risk sentiment has been good for most of the session. There are other themes affecting the market like the Pelosi visit to Taiwan. Gold is also positive on the day but this could all be thrown on its head in the afternoon as the U.S. figures are due to be released and there are some Fed speakers due to hit the wires. The U.S. services PMI (Jul) is expected to reach 47.0. and the ISM number has been forecast to move lower to 53.5 down from last month's 55.3.
U.K. Services PMI (Jul) 52.6 vs exp 53.3 previous 54.3
EZ Services PMI (Jul) 51.2 vs exp 50.6 previous 53.0
German Services PMI (Jul) 49.7 vs exp 49.2 previous 52.4
Australian Services PMI 50.9 previous 52.6
Japanese Services PMI (Jul) 50.3 previous 54.0
