EURO PMI READS: nothing holding back the ECB hikes, € and Bunds higher:

Overall: Inflation cooling at the input level but output charges continue to climb, partly on working through higher cost inventories as well as costs of labour leading to sticky inflation concerns. New orders continue fall generally although pockets of improvement and slower rates of decline lead to better outlook optimism. Lagarde getting the green light to continue to press against embedded cost pressure risks – which leads to an interesting divergence potentially opening with the Fed vs ECB. Bigger picture, further pressure on the greenback could add to US inflation concerns as the strong dollar has partially helped insulate the US economy from import prices.

EUROZONE: Jan Manf PMI 48.8 (est 48.8), 7th straight contraction. Eurozone manufacturing downturn eases further in January and cost pressures fade; production volumes and new factory orders falling further, however, slower rates of contraction in both cases; stocks of finished goods declined for the first time since May last year; input price inflation slowing to a 26-month low but output charges increased at a faster pace; business optimism about the year ahead has surged higher over the past three months.

GERMANY: Jan Manf PMI 47.3 (est 47) 7th straight contraction. New Orders: 43.5 (prior 42.1). Demand conditions remain challenging, but confidence grows as cost pressures subside; continued steep decline inflows of new work received; high stock levels among customers; still see elevated prices and investment reticence; Input cost inflation sinks to 27-month low; Expectations turn positive for first time in almost a year, but remain historically subdued, amid a backdrop of still-high inflation and economic uncertainty.

FRANCE: Jan Manf 50.5 (est 50.8), 1st expansion in 5 months and highest since Aug 2022. New Orders: 46.5 (prior 44.9). Manufacturing sector conditions improve slightly as firms bolster hiring and demand downturn eases; Employment rises again following brief drop in December; New orders fall at weakest pace since downturn began last June; Business confidence up; cost inflation slows to 25-month low;

ITALY: Jan Manf PMI 50.4 (est 49.5), 1st expansion in 7 months. Italian manufacturing economy returns to marginal growth in January; modest rise in production but orders decline again; Further growth in employment amid bounce in confidence; labour shortages remain a continual challenge for firms; Inflation rates head lower but many firms are looking to claw back margins through chunky upticks in their own output charges, and with labour market conditions remaining tight, core inflationary pressures could become a major concern in the months ahead.

GREECE: Jan manf PMI 49.2 (prior 47.2), 7th straight contraction.

NORWAY: Jan manf PMI 50.0 (prior 50), 29th month of expansion.