Yesterday, we observed significant readings of economic index. The worse data from Europe clearly shifted investors’ interest across the ocean. Subsequent weaker readings did not reverse this trend. In the background, there were decent unemployment results from Poland.
Economic Indexes in Europe
The week began with objectively bad data from economic index readings. Analysts’ expectations were not high, however, they were not met. The PMI index for the industry in the eurozone scored 44.8 points which indicates serious problems. In services, we barely closed above the 50-point threshold, specifically achieving 50.5 points. It’s worth noting that this is respectively 0.8 and 1.6 points below already falling assumptions. Markets had no doubts on how to interpret this data. As businesses began to anticipate slowdown, it was time to retreat. Immediately following the decision, we witnessed a clear flow of capital across the ocean. To better illustrate the scale of this phenomenon, the exchange rate of the dollar to the zloty is worth pointing out. It jumped by 3 grosz up after these readings.
Response from Across the Ocean
Economic indexes were published yesterday not only in the eurozone. American expectations for improving industrial sentiment – in the context of what is happening – seemed impossible to achieve. Such proved to be the case. The results in absolute numbers were better than in Europe, however, the decrease by 1.5 points in the industrial PMI was not offset by a symbolic 0.1 point above in the index of services. As a result, we witnessed a partial rebound in the other direction. The correction had a clearly smaller range than the initial move. The dollar’s exchange rate ended the day in a much more favorable spot in relation to the euro.
Unemployment in Poland
The unemployment rate in Poland has remained at a very favorable level of 5%. Of course, it should be remembered that in our country, unemployment is measured by registered unemployed people, not in the same way as in the West. There, the BAEL method, i.e. the Study of Economic Activity of the Population, is much more popular. The difference is that the latter method only considers people who are actively seeking work. Consequently, these indications are simply lower. The best evidence of the scale of differences is the fact that using the BAEL method, our country achieved a result of 2.7% in the second quarter. This morning, the strengthening of the zloty against the euro has been ongoing. It is stronger than in Hungary or in the Czech Republic, in the case of their currencies, so certainly part of this movement can be attributed to good readings.
By Maciej Przygórzewski – chief analyst at InternetowyKantor.pl.
Source: https://managerplus.pl/slabe-dane-z-europy-przesuwaja-kapital-za-ocean-54595
