The PMIs of business activity for November contained no surprises. The economy is still growing at a reasonably solid clip, albeit the dichotomy between a stagnant manufacturing sector and a more solid service sector remains. While the latest employment data runs on somewhat of a lag, the Eurozone as a whole continued to generate jobs at least through the third quarter of 2025, even if the rate of jobs growth is coming down.
This bodes well for a solid end to the year in the Euro Area economy. Buoyed by a still healthy labour market, we expect the services sector to continue to support modest growth in the Eurozone and support the euro in the coming months.
In the meantime, investors will have a handful of speeches from European Central Bank officials to digest, including from President Lagarde on Thursday. Yet, given the high bar for further rate cuts, we do not foresee any fireworks to come out of these communications.
