Eurozone Flash PMI Sequence: France, Germany, Eurozone in One Hour

[FXS Prop Desk]

Eurozone flash PMIs are released in sequence: France first, then Germany, then the Eurozone aggregate, all within about an hour. Each can move EUR.

Because the releases arrive in sequence, a position opened after the French release is exposed to two more surprises within the hour. Waiting for the Eurozone aggregate, or using a reduced size until then, keeps the risk predictable.

How the sequence plays out:

• France sets the first impression.
• Germany often has the largest impact due to its economic weight.
• The Eurozone aggregate is partly predictable from the first two, so its surprise is usually smaller.

Practical considerations:

• Three moves within an hour can whipsaw positions.
• Services vs manufacturing: services dominate the economy, manufacturing can matter more for sentiment.
• UK PMIs follow shortly after, affecting EURGBP.

Do you trade the PMI sequence, or wait until all three are out?

[Shadow Trader]

I wait for Germany, but I do not wait for the aggregate. By the time France and Germany are out, the Eurozone figure is mostly a calculation, and the consensus for it is stale.

My rough rule is that the aggregate surprise lands near half of the average French and German surprise. If both beat by 1.5 points, I expect the Eurozone number about 0.7 above its consensus, and a print there barely moves EURUSD even though the headline reads as a beat.

That gap is where the trades are. An aggregate below what France and Germany implied means the periphery was weak, and the euro sometimes gives back part of the German move quickly.

On services against manufacturing, I care most about the price components that the wires quote a little after the headline. A jump in services output prices does more to the 2 year Schatz yield than a half point beat in activity, and EUR follows the Schatz.

Size is the other control. I trade the French print at a third of normal, add after Germany only if both agree, and tighten or close before the UK numbers hit EURGBP.

Does anyone run a quick nowcast like this between prints? I wonder if others weight Germany more than I do.