Global PMI Scorecard: Growth accelerating

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Despite the markets showing their dismay when the manufacturing PMIs for May were published, the pace of expansion in the global economy has actually picked up! The JPMorgan Global Composite PMI, which takes the manufacturing and non-manufacturing/services into account, rose to 52.6 from 51.8 in April (a number above 50 indicates expansion) as the turnaround of Japan since the twin disaster seems to be lending solid support.

The contraction in Japan has eased significantly, with the Markit composite PMI jumping to 46.2 from 35.0 in April.  Growth in the US eased slightly with my ISM GDP-weighted composite PMI registering 54.3 compared to April’s 54.6. The manufacturing and non-manufacturing PMIs reversed roles – the non-manufacturing PMI jumped to 54.6 from 52.8 while the manufacturing PMI sank to 53.5 from a very robust 60.4. Growth in the Eurozone’s economy at long last eased with my GDP-weighted PMI coming in at 55.2 compared to 57.1 in April. Although the pace of growth in both Germany and France has eased, these countries continue to find themselves growing at a rapid pace. Elsewhere the pace has eased somewhat in China, the UK, Hong Kong and India.

Sources: ISM, Markit, CFLP, Plexus Asset Management.

GDP-weighted/ Composite PMIDirection 


Rate of change

US***54.354.6Growing, robustSlower
Eurozone****55.257.1Growing, robustSlower
Germany*57.159.2Growing, robustSlower
France*60.362.4Growing, robustSlower
Japan*46.235.0ContractingSignificant improvement
Emerging economies
China**57.958.7Growing, robustSlower
India*57.760.7Growing, robustSlower
Russia*55.455.4Growing, robustSlower
Hong Kong*52.252.9GrowingSlower
UAE*56.057.5Growing, robustSlower
Saudi Arabia*62.662.7Growing, robustSlower
JPMorgan Global Composite*52.651.8GrowingFaster 

Sources: *Markit; **CFLP, Li & Fung, Plexus Asset Management; ***ISM, Plexus Asset Management; ****Markit, Plexus Asset Management.

Except in the case of Japan, where the manufacturing sector expanded again after reeling in the face of the twin disaster, growth in the global manufacturing sector has eased significantly. My GDP-weighted manufacturing PMI for the major economies dropped by 2.4 points to 53.1 in May.

The USA’s manufacturing sector was hit the hardest, succumbing 6.9 index points, followed by Germany’s 4.3 and the Eurozone’s 3.4 index point declines. The manufacturing sectors in the Eurozone’s problem countries are struggling, though. The contraction in Greece has deepened, Spain has moved into contraction while Ireland’s PMI fell heavily from 56.0 to 52.1. China’s CFLP manufacturing PMI was in line with my earlier expectations based on seasonal weakness. Brazil was the only economy that managed to eke out a faster rate of expansion.


Manufacturing PMI




Rate of Change

US*****53.560.4GrowingSlowed significantly
Eurozone*54.658.0GrowingSlowed significantly
Germany*57.762.0Growing, robustSlowed significantly
France*54.957.5GrowingSlowed significantly
Italy*52.855.5GrowingSlowed significantly
Spain*48.250.6ContractingFrom growing
Ireland*51.856.0GrowingSlowed significantly
U.K.*52.154.6GrowingSlowed significantly
Japan*51.345.7GrowingFrom contracting
Emerging economies
Brazil*50.850.7Growing, weakFaster
Czech*55.959.0Growing, robustSlowed significantly
Turkey*50.652.7Growing, weakSlowed significantly
India*57.558.0Growing, robustSlower
Russia*50.952.1Growing, weakSlower
Taiwan*54.958.2GrowingSlowed significantly
RSA***55.156.4Growing, robustSlower
S Korea51.251.7GrowingSlower
Global****53.155.5GrowingSlowed significantly

Sources: Markit*; Li & Fung**; Kagiso***; Plexus Asset Management****; ISM*****.

Sources: Markit*; Li & Fung**; Plexus Asset Management****; ISM*****

Non-manufacturing/Services PMIs

The JPMorgan Global Services PMI for May jumped to 52.5 from 51.0 in April.

The US ISM non-manufacturing PMI retraced 1.8 index points of the 4.5 index point drop in April. The Eurozone PMI dropped by 1.3 index points to 55.4 from 56.7 in April, with the countries other than Germany and France taking the biggest knocks. Growth in Italy’s services sector has decelerated sharply, whereas Spain and Ireland continue to find themselves on the brink of contraction. Growth in the UK’s services sector eased slightly to 53.8 from 54.3 in May. The pace of contraction in Japan has eased significantly by 8.8 index points to 43.8 in May from 35.0 in April. Australia’s services sector is contracting again.

Sources: ISM, Markit, CFLP, Plexus Asset Management.

Non-manufacturing/ Services PMI  



Rate of Change

Eurozone55.456.7Growing, robustSlower
Germany56.156.8Growing, robustSlower
France62.562.9Growing, robustSlower
Italy50.152.2GrowingSlowed significantly
Japan43.835.0ContractingImproved significantly
Australia49.951.5ContractingFrom expanding
Emerging economies
China*61.962.5Growing, robustSlower
India57.759.2Growing, robustSlower
Russia57.655.8Growing, robustFaster
JPMorgan Global Services  








Sources: Markit; CFLP*; ISM**; Plexus Asset Management.

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