LONDON (AFX) - European, economic data scheduled for today, Sept 5
EURO ZONE
-The purchasing managers index for the services sector is expected to ease for the second month in a row, in line with a similar downturn in the manufacturing PMI and business confidence surveys. Economists expect the services PMI to decline to 57.5 in August from 57.9 in July and a six-year record high of 60.7 in June.
"Measures of business confidence have started to roll over across the euro area, so we anticipate a small drop. That would still leave the level of the services... PMI consistent with strong output growth," Credit Suisse economists said.
-Retail sales are expected to fall 0.4 pct month-on-month in July, wiping out most of the 0.5 pct gain recorded the month before. German retail sales fell 1.5 pct in July as consumer spending declined after the end of the World Cup, and this will weigh on the overall euro zone reading, economists said.
"We expect the fall on the month to have been led by lower retail sales in Germany, partially offset by modest increases in the other large euro area countries," said Nick Matthews of Barclays Capital. This would suggest that private consumption growth will slow slightly in the third quarter, he said.
The year-on-year rise in retail sales is expected to ease to 1.4 pct from 1.5 pct.
GERMANY
-The German services PMI is expected to hold up better than the euro zone figure, with economists forecasting an August services PMI reading of 56.0, little changed from the July reading of 56.1. The index fell sharply in July, plummeting 4.9 points as the previous World Cup related boost evaporated. With the correction of the World Cup effect fully taken into account in the July survey, there is little scope for a further significant drop in the near term, economists said.
FRANCE
-The French services PMI is expected to fall in line with the general euro zone trend, and is seen slipping to around 60.5 in August from 61.0 in July. Confidence surveys across the euro zone have been on a downward trend after peaking in June, pointing to a moderation in economic activity in the second half of the year.
ITALY
-The Italian services PMI is expected to ease only modestly, to 58.4 in August from 58.6 the month before. Italy's manufacturing PMI fell sharply but sentiment in the services sector is expected to hold up better.
UK
-The August services PMI index is seen rising by 57.6, down a touch from 57.9 in July. This survey has dropped for three straight months but its falls are expected to slow in August. At around these levels, quarterly services growth will be at around 0.9 pct from the second quarter.
"Of the few domestic related indicators that are available, most suggest the economy was relatively strong in August," said John Butler, economist at HSBC.
-The British Retail Consortium's retail sales monitor for August is predicted to slow, with like-for-like sales at 2.4 pct year-on-year, from 3.4 pct in July.
Last month, the year-on-year measure was flattered by base effects due to the London bombings in July 2005. Additionally, the heat-wave in July this year apparently boosted food and drink sales.
"Anything less than a 4 pct increase can only be regarded as disappointing," said Tim Sleep, director of retail at accountants Ernst&Young.
Sleep said shopping should have been encouraged by the fact that the heatwave of July was replaced by the cooler weather in August, and noted that August's figures will be set against a weak comparison last year.
pan.pylas@afxnews.com
pp/lam
