The consensus is calling for a further drop in the manufacturing PMI to 47.0 from 47.4, while services is likely to decline from July's 48.3 reading to 48 in August.

Jennifer McKeown, European economist from Capital Economics wrote in her daily research note that she is not expecting a lot of good news with the PMI data pointing to a technical recession in Europe.

"Overall, we expect the surveys to paint a fairly downbeat picture. The manufacturing index could edge up after its recent sharp falls but we expect the service sector to be little changed, leaving the composite index at 47.8 and still pointing to declining output," she wrote.

Ahead of the euro zone estimates, markets will receive French and German PMI reports. German manufacturing PMI is expected to fall further to 50.5 in August from July's 50.9 level, while services will likely dip to 52.1 from the previous month's 53.1 handle. In France, the manufacturing PMI is forecast to slide to 47 in August from July's 47.1. The services PMI is expected to remain unchanged at 47.5 for the month.

Turing to the UK, annualized sales are expected to increase 1.8% following a previous rise of 2.2%.

All times in EDT:

Thursday:

3:00 FR PMI Manufacturing August Preliminary Exp: 47 Prior: 47.1

3:00 FR PMI Services August Preliminary Exp: 47.5 Prior: 47.5

3:30 DE PMI Manufacturing August Advance Exp: 50.5 Prior: 50.9

3:30 DE PMI Services August Advance Exp: 52.1 Prior: 53.1

4:00 EU PMI Manufacturing August Advance Exp: 47 Prior: 47.4

4:00 EU PMI Services August Advance Exp: 48 Prior: 48.3

4:00 EU PMI Composite August Advance Exp: 47.7 Prior: 47.8

4:30 GB Retail Sales (M/M) July Exp: -0.2% Prior: -3.9%

4:30 GB Retail Sales (Y/Y) July Exp: +1.8% Prior: +2.2%

4:30 GB Total Business Investment(Y/Y) Q2 Preliminary Exp: +3.1% Prior: +4.5%

4:30 GB Total Business Investment (Q/Q) Q2 Preliminary Exp: -0.7% Prior: -1.8%

August 21 PT Bank of Portugal Publishes Statistical Bulletin

By Neils Christensen, This email address is being protected from spam bots, you need Javascript enabled to view it , edited by Megan Ainscow, This email address is being protected from spam bots, you need Javascript enabled to view it

CEP Newswires - CEP News © 2008. All Rights Reserved. www.economicnews.ca

The Copying, Broadcast, Republication or Redistribution of CEP News Content is Expressly Prohibited Without the Prior Written Consent of CEP News.

A copy of CEP News disclaimer can be found at http://www.economicnews.ca/cepnews/wire/disclaimer.