The global composite PMI rose for the third consecutive month in January (up to 51.8 from 51 in December), reaching its highest level since June 2023. All sectors have contributed to this improvement in global activity. In January, the global manufacturing and services PMIs hit their highest levels since August 2022 and July 2023, respectively.
The most significant development for January was the rise in the global manufacturing index, taking it back to the 50 threshold for the first time since August 2022. 22 out of the 31 countries for which January data are available showed an improvement in the manufacturing sector, driven by the “new orders” and “production” components, including in Canada, the United States, Greece, Italy, the Netherlands, Spain, India and Brazil. In China, the manufacturing index stagnated as the “new orders” component declined and the “production” component plateaued. The “delivery times” component continued to deteriorate, for the eighth consecutive month, with the recent troubles in the Red Sea resulting in longer delivery times in most of the countries surveyed. As a result, the input prices index rose in January, particularly in Turkey, the United States, the UK and the Netherlands, while the "output prices" component, which had been edging higher since last July, stagnated globally. There has been reassuring news on the employment side, with the index recovering in most developed countries, with the exception of Italy, Japan, Switzerland and France. The index also improved in China, Brazil and Poland.
In services, half of the countries in our sample posted an improvement in the index from the previous month. There were sharp increases in India and Brazil, as well as smaller ones in the United States, Japan and Italy, where the index has returned to expansion mode. Conversely, while it is only slightly lower in China, France and the Eurozone, the services index plummeted in Ireland and Germany. Overall, the service sector index is being driven up by the rise in its six components, most notably in the “new export orders” and “output prices” components.
S&P GLOBAL PMI (2023) - JANUARY 2024
