March 4, 2019

Manufacturing Sector Growth Uneven Across The Globe


  • The J.P. Morgan Global Manufacturing purchasing managers’ index (PMI) fell from 50.8 in January to 50.6 in February, its lowest level since June 2016 due to stagnant growth in new orders. Additionally, the bank said the “trend in international trade remained lackluster in February, as new export business contracted for the sixth straight month.”
  • In Asia, readings have been mixed so far this month. The Caixin PMI for China improved from 48.3 in January to 49.9 in February. Chinese manufacturers raised output due to firmer client demand and total new orders also rose slightly. Data indicated that the upturn was predominantly driven by greater domestic demand. Japan’s index fell from 50.3 in January to 48.3 in February, its lowest reading in three months, due to a decline in new export business. India’s PMI was at 14-month high due to increases in sales, output, and employment. Finally, the PMI for ASEAN countries – Indonesia, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam – fell from 49.7 in January to 49.6 in February, the first back-to-back monthly deterioration in business conditions for over two years. New orders continued to decline due to foreign sales declining for the seventh month running.
  • The IHS Markit for the Eurozone fell from 50.5 in January to 49.2 in February due to declines in output and new orders. The weakest performers were Germany and Italy though Spain also saw a deterioration in operating conditions for the first time since November 2013. The IHS Markit/CIPS PMI for the United Kingdome, meanwhile, fell to a four-month low of 52.0 in February, down from a revised reading of 52.6 in January and was at its second-lowest level since July 2016, the month following the Brexit referendum. Growth of new order inflows in the UK “eased to near-stagnation, amid signs of a slowing domestic market and a further drop in new export orders” and “companies linked lower overseas demand to weaker global economic growth, especially in Europe.”
  • As a reminder, all available PMI readings can be found here.