Manufacturing PMI surveys for euro zone countries and Britain will be the latest litmus test of the durability of fledgling economic recoveries.
Even the readings from Spain and Italy have shown improvement over the summer so it may well be that they are the most interesting given we’ve already had flash readings for the euro zone, Germany and France which showed business activity across the currency bloc picked up faster than expected in August.
Having exited recession in the second quarter, further euro zone growth now looks likely in the third.
Britain’s recovery looks more solid still following a 0.7 percent leap in GDP in Q2. Its PMI will be augmented by Bank of England figures on its funding for lending scheme, whereby banks are offered cheap money on the proviso they lend it on to smaller companies.
Bank lending remains constrained but generally improves once economic recovery is underway rather than leading it.
China’s PMI, released earlier, showed factory activity expanded for the first time in four months on the back of stronger domestic demand. With the United States enjoying Labor Day holiday, its equivalent report is not due until tomorrow. A data-heavy week in the U.S., culminating in non-farm payrolls on Friday, will go a long way to deciding whether the Federal Reserve will begin easing back on its money-printing programme this month.