© Reuters.
Investing.com – Just released data from the Purchasing Managers Index for a region and a few European countries, which saw a dramatic and surprising decline, remaining below 50 points, and even defying expectations and down from the previous month, particularly in light of the recent turmoil in Europe, generally due to the war in Ukraine.
SMEs
The index fell to 46.6 points in October, after registering 47.8 points last month.
And in the euro area it fell to 47.1, after recording 48.1 last month.
While the index fell, contrary to expectations, and achieved a score of 45.7, after a record 47 was estimated.
It also dropped to 47.4 points, after registering 47.7 points last month.
The manufacturing PMI determines the level of activity of purchasing managers in the manufacturing sector, a reading above 50 indicates expansion and below 50 indicates contraction and decline in manufacturing activity. To get a reading of this indicator, purchasing managers determine the level of certain elements of the industry, including employment, production, new orders, resource allocation and inventory. The uptrend has a positive impact on the country’s currency.
Currency traders are watching this indicator closely: Purchasing managers, due to the nature of their jobs, can access their companies’ performance data, making this indicator a leading indicator of overall economic performance.
European agreement
European Union leaders agreed in the early hours of Friday morning on a “roadmap” to implement measures in the coming weeks to stem the rise in energy prices, as Germany backed away from its opposition to Russian gas price cap plans after expressing strong opposition earlier.
“We now have an excellent roadmap”, said the President of the European Commission Ursula von der Leyen, while the President of the European Council Charles Michel spoke of “agreeing a package of measures” which must now be “dealt with carefully” .
On Friday, the President of the European Council Charles Michel confirmed that the European Union has reached a final agreement on an action plan to overcome the repercussions of the energy crisis facing the countries of the region, following the interruption of the supply of gas from Russia via Nord Stream 1 to the European Union via Germany, and the sharp rise in gas, electricity and energy prices in the countries of the region.
Economic suicide … a Hungarian exception
Hungarian Prime Minister Viktor Orban stressed that the European Union’s plan to set a ceiling on the price of Russian gas is economic suicide for the Union, noting that this will not help Ukraine.
Orban wrote on his Twitter page: “Brussels’ latest plan to limit the price of Russian gas amounts to a complete gas embargo in our country, i.e. an economic suicide attempt that will not help Ukraine, and I expect a great debate at the next EU Council “.
The Hungarian Prime Minister also recalled that at the EU summit in Brussels Budapest would have obtained an exception if the European Commission’s proposals for a cap for the price of gas and pan-European gas purchases were accepted, because the opposite would mean that the country would have run out of gas.
