The IHS Markit Retail PMI report released today for June highlighted broadening divergence among the three largest components of the shared currency’s GDP – Germany, France, and Italy. The index ticked slightly higher to 51.8 from 51.7 the prior month due to a strong enough rebound in retail sector strength in Germany to make up for weakness in France and Italy. This highlights the continued challenge for the ECB in determining monetary policy for the entire Eurozone. Mario Draghi of Italy has clearly favored the weakest links in setting policy for the broad region while Germany runs too hot.

070518 ihs eurozone retail pmi divergence