The global manufacturing PMI was down again in October, with significant drops in the United States, the euro area, Austria, Germany, Greece, Italy, Spain, Switzerland and the United Kingdom. China saw an improvement but the index stayed below 50.
MANUFACTURING PMIThe steep downtrend of new orders continued in the euro area and its member countries, with the exception of France, where the decline in October was more limited after the big drop the previous month. Orders were also down strongly in the US -where the rebound in September clearly did not last- as well as in the UK. China recorded some improvement. India continues to benefit from strong order inflow.
Despite the gloomy readings for the manufacturing PMI and the incoming orders, the employment data continue to be surprisingly resilient. In October this is hiding opposing dynamics; down in the US to 49 but up in the euro area to 52.6. Even in Germany, where the other data are poor, the data improved. The UK on the other hand recorded a big drop. The number were better in China, moving to 48.7, and very strong in India, jumping from 50.7 to 53.6.
After the disappointing jump in input prices in the euro area in September, October brought good news with a drop in the PMI to a level close to that of August. Nevertheless, the level remains elevated. The numbers were down in the US and the UK. China saw a jump from 47.6 to 50.7.
The developments in terms of output prices tend to be positively correlated with those in input prices. The US benefited from a big drop whereas in the euro area and the UK the decline was smaller. Output prices moved higher in Japan.
Delivery times again brought welcome news, with higher numbers, which means shorter delivery times. This points towards an easing of supply side tensions. Finally, the services PMI declined in the US after a huge rebound in September. In the euro area the index hardly moved but Germany saw a surprising improvement. Data were weaker in the UK and in China.
William De Vijlder
MANUFACTURING PMI - NEW ORDERS
MANUFACTURING PMI – EMPLOYMENT
MANUFACTURING PMI - INPUT PRICES
MANUFACTURING PMI- OUTPUT PRICES
MANUFACTURING PMI - DELIVERY TIMES
SERVICES PMI
