when the United States and China argue, Europe goes nuts!

The impact of the Sino-US trade war on the European economy is confirmed each month a little more. The latest batch of IHS Markit activity indicators for the eurozone reveals a further slowdown with a composite index at 50.4 (against 51.9 in August) at the lowest in six years, including a manufacturing flash PMI at 45.6. against 47.0 in August. Remember that below the 50 mark, activity is in contraction.

For Chris Williamson, economist at Markit, "The evolution of the various variables of the survey seems to announce a contraction of the economy of the euro area in the coming months".

According to estimates by the European Central Bank, GDP growth in the euro area would rise from 1.9% in 2018 to 1.1% in 2019, before recovering slightly in 2020.

A weak American economy

"In any case, the level of 50.4 sends the message of almost sluggish growth at the end of the third quarter.This is a very soft way to get into the next! The German manufacturing sector is no surprise at the The "bad luck" that it crosses extends both to that of partner countries and gradually to domestic services ", comments Hervé Goulletquer, strategist at Banque Postale Asset Management.

In fact, the German manufacturing subsector plunged to 41.4, its lowest level in more than a decade.

That Germany, very exposed to the trade war because of the importance of its exports, and thus ricochet effect the euro zone are affected, raises a certain logic. But the paradox is that the US and Chinese economies do not seem to suffer too much from the conflict.

"If we try to take a step back from the message sent by this delivery of PMI surveys, the overall diagnosis seems to be the following: manufacturing and residential activity is improving in the United States, the Chinese figures describe a rather progressing economic situation and the euro area is struggling.In this regard, the image sent by the hierarchy of economic surprise indices is probably quite faithful to the relative dynamics between the three heavyweights of the world economy. ", explains Hervé Goulletquer.

How to explain this trend? "The US economy is not very open to the rest of the world and therefore less sensitive to the slowdown in international trade.Internal demand remains the alpha and omega conditions for growth.China has the means to drive the activity the point is all the more important that on October 1st the country will celebrate 70 years of the People's Republic, and this in a complicated environment (tensions with the United States, Hong Kong events and presidential election in Taiwan). Party-state can not simply show signs of weakness at such a time and in such a context. "

As for the euro area, it "is more exposed to world trade and the German manufacturing locomotive is struggling, whether it is to the" big export "(outside Europe) or with its professional equipment and auto. "

Conclusion, "rather better in the United States, resistance in China and weakening in the eurozone, as if these two first regions" drank "and the third" drank "!