Eurozone: PMI indices rebound in may

Chart of the week

Flash PMI indices are showing sharp rebounds from April’s abyssal depths. The composite PMI (1) for May rose from 13.6 to 30.5. The rebound in the services component is spectacular: after plummeting from 52.6 in February down to only 12 in April, it recovered to reach 28.7 in May. This remains a particularly weak number, especially given that the low point in February 2009 was 39.2. The manufacturing PMI rose from 33.4 to 39.5, a level and pace in line with 2009.

Our analysis

During typical recessions, the manufacturing sector tends to undergo much greater volatility than services. This time, however, the social lockdown measures have resulted in the services sector indices falling furthest. The gradual easing of lockdown arrangements is being reflected by an equally gradual pick-up in activity, which should push the PMI indices to improve further in the months ahead.

The PMI indices are usually closely correlated with economic growth, but this is unlikely to hold true in the months ahead as the traditional cyclical mechanisms will not be the only factors at play in the economy.


(1) The Purchasing Managers’ Index (PMI) is an index of the prevailing direction of economic trends in the manufacturing and service sectors.

See also :

A multi-speed recovery in China


The opinion expressed above is dated 25 May 2020 and is liable to change.


This document is not pre-contractual or contractual in nature. It is provided for information purposes. The analyses and descriptions contained in this document shall not be interpreted as being advice or recommendations on the part of Lazard Frères Gestion SAS. This document does not constitute an offer or invitation to purchase or sell, nor an encouragement to invest. This document is the intellectual property of Lazard Frères Gestion SAS. LAZARD FRERES GESTION – a simplified joint stock company with share capital of €14,487,500 – Paris Trade and Companies Registry No. 352 213 599. 25, RUE DE COURCELLES – 75008 PARIS, FRANCE