October 7, 2019

Chinese Manufacturing Index One Of Few That Improved In September


  • Manufacturing readings worldwide have, so far, looked bleaker last month. The JP Morgan/IHS Markit global purchasing managers’ index (PMI) rose to 49.7 in September, but was still below the 50.0 mark that separates improvement from deterioration. The report said, “Global manufacturing production was broadly stagnant in September, as reduced intakes of new business discouraged any meaningful expansion of output volumes.” Data signaled deteriorations in overall business conditions in 15 of the countries covered. The reading in China was one of the few to improve.
  • The IHS PMI reading for the Eurozone dropped to 45.7 in September from 47.0 in August. Output, new orders and purchasing all fell last month as “operating conditions in the euro manufacturing economy deteriorated in September to the greatest degree in just under seven years.” The IHS/CIPS reading for the United Kingdom hit a four-month high of 48.3 in September, but new orders, output, and employment all declined.
  • Readings from Asia were mixed. Caixin said “China’s manufacturing sector saw a modest improvement in overall operating conditions during September” as “production and total new orders both expanded at quicker rates than in August, despite a further reduction in new export business. Chinese firms also “expanded their buying activity and inventories, albeit at marginal rates” and “currency movements contributed to a renewed rise in average input costs.” Japan’s manufacturing reading fell last month. Jibun Bank Japan explained, “Japan’s manufacturing sector remained under pressure at the end of the third quarter as firms cut production amid sustained weakness in demand.” South Korea’s index was below the 50.0 mark that indicates contraction for the fifth month in a row and the PMI reading for India was unchanged. The IHS Markit reading for ASEAN countries rose to 49.1 in September from 48.9 in August to 49.1, but still marked a “marginal deterioration in the health of the ASEAN manufacturing sector,” which includes industries in Indonesia, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam.
  • As a reminder, all PMI readings can be found here.