Global Manufacturing Recoveries Are Uneven
- According to the JP Morgan global manufacturing purchasing managers’ index (PMI), the global manufacturing sector expanded at a robust clip at the start of the third quarter even though rates of increase in output and new orders eased again due to record supply chain. The PMI reading for July was 55.4, slightly below the 55.5 registered in June. Improvements were seen across the consumer, intermediate and investment goods industries. The consumer category saw the weakest increase overall, but was the only sector to register faster growth.
- The Caixin PMI for China indicated a softer improvement in operating conditions at the start of the third quarter. Specifically, the index fell from 51.3 in June to 50.3 in July, signaling the slowest improvement for 15 months. Output expanded at the slowest rate for 16 months, while overall new work fell slightly for the first time since May 2020. The COVID-19 pandemic also continued to dampen export sales, which rose only slightly in July.
- The IHS Markit/CIPS PMI for the Eurozone fell to 62.8 in July from 63.4 in June as output and order growth rates slowed. Inflation also hit a new low as supply chain constraints continued to plague the industry.
- The United Kingdom’s manufacturing sector remained solid in July. The seasonally adjusted IHS Markit/CIPS PMI was 60.4 in July. Although rates of expansion in output and new orders slowed, they remained among the best in the survey history. Scarcities remained a prime concern for manufacturers, however, as stretched supply chains and staff shortages prevented faster output and employment growth.
- The IHS Markit Mexico Manufacturing PMI rose for the second month in a row in July, increasing from 48.8 in June to 49.6. The reading was at its highest level in 17 months. The data highlighted tentative signs of recovery in Mexico’s manufacturing industry, with production declining at the slowest rate in 17 months and business sentiment strengthening. Inflation rose at the fastest rate in three years, however.
- PMI readings in India and Japan also strengthened while the overall reading for small Asian countries showed a contraction in that region’s manufacturing sector.
- Read all of these PMI reports and find more from around the globe here.