Eurozone: A shock of unprecedented size – BNP Paribas

Having been almost absent from the data so far, the Covid-19 shock was fully visible in the PMI (Purchasing Managers Index) for the Eurozone, released on 24 March 2020, Louis Boisset from BNP Paribas reports.

Key quotes

“The composite PMI collapsed to 31.4 in March, its lowest level since July 1998. The Eurozone is now deeply and widely affected by the massive shock caused by the coronavirus epidemic.”

“The services sector PMI showed a dramatic fall, to only 28.4 in March. Its previous low, during the financial crisis in February 2009, was 39.2.”

“Maintaining productive activity and employment in companies will be key in determining the condition in which we emerge from the crisis.”

“The Eurozone should see a significant fall in GDP in the 2nd as well as in the 1st quarter of 2020, with some health measures liable to be extended or perhaps even tightened further.”