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Global Purchasing Manager Indices, Update December 17

Manufacturing PMIs are considered to be the leading and most important economic indicators.  Since the Fed’s QE3, this is the third month of improvements in global PMIs after a strong slowing in summer 2012.

 

January 25th

Expansion-contraction ratio: There are as many countries that show values above 50 as under 50.

Positive-negative-change ratio: 18 countries showed better values than the previous month, whereas only 11 had weaker ones.

Since the Fed’s QE3, this is the third month of improvements. The United States and Mexico are leading with Markit PMI of 54.2 and 54.9. According to the ISM report, however, there is a lag, production is positive, but employment is weak, which is the opposite of the Markit report for the US.

 


(click to expand) 

 

Long-time overview

 

China and other emerging markets came far more quickly out of the 2008/2009 recession. During 2009 and 2010, the Fed fueled the Chinese, Brazilian and other emerging markets’ recoveries and housing bubbles with cheap money. The Chinese government helped with a huge investment program. Due to the depressed housing market, the US could not recover that quickly.

In 2010/2011, Germany and the Euro zone followed the Chinese expansion thanks to strong German exports, but in 2011 rising gas and falling home prices caused the United States to slow down.

The explosion of the euro crisis and the upcoming austerity radically stopped the European expansion in the second half of 2011. European PMIs fell from 57 to 47 in a couple of months. The United States was not impressed by the euro crisis at all, but thanks to cheaper gas prices and the flow back of funds into the US, they recovered at the end of 2011. From April 2012 onwards, all global economies were weakening. This tendency could be stopped by the liquidity injection from global central banks in September 2012.

 

Global PMIs December 3, 2012

Global PMIs December 3, 2012

JP Morgan’s global PMIs vs. different risk indicators

Services are an important part of the economy, which are not contained in the PMIs above. JP Morgan’s global PMIs show the combined global manufacturing PMIs, of services PMIs and a composite of manufacturing and services. The combination is made up through different weights per country.
After the strong improvements in the manufacturing PMIs in 2010 and 2011 potentially fueled by quantitative easing, it is now the turn for the services PMIs to outpace manufacturing PMIs.

(Click for details inside the table) 
Month
Manu factur.
Services
Com posite
S&P 500
Copper
Brent Oil
AUD/ USD
Reference date
August 201351.756.155.282.116453304115.700.9053Sep 3, 2013
July50.854.954.185.117033168108.930.8903August 2, 2013
June50.651.352.984.11615
3176
105.85
0.9116
July 3, 2013
May50.653.753.184.51640
3297
99.92
0.9750
June 3, 2013
April50.452.151.976.41582
3126
102.85
1.0253
May 3, 2013
March51.253.253.177.615543354107.171.0424April4,2013
February50.853.353.073.815253508110.081.0202March4,2013
January51.553.453.371.315033658113.461.0427Feb4,2013
December 201250.254.853.774.514613700111.421.0481Jan 5, 2013
November49.754.953.782.714073656110.921.0432Dec 3
October49.252.151.382.614233557105.751.0338Nov 3
September48.954.052.578.314373775108.071.0231Oct 3
August48.152.351.174.314063485108.071.0239Sep 3
July48.452.751.772.3136133071061.0465Aug 2
June48.950.650.373.213573466971.0230Jul 2
May50.652.552.179.312633289980.9640Jun 3
April 201251.452.052.376.4140237821161.0260May 2, 2012
September 201149.952.652.055.7112331321020.9634Sep 2, 2011
February 201157.859.357.077.5133144981151.0127Mar 2, 2011

sources:

Business Insider Dec 3

Business Insider Nov 1

Business Insider Oct 1

Business Insider September 3

Prices: Bloomberg, Investing.com

 

Next page: Which indicators are the leading ones?

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Permanent link to this article: http://snbchf.com/2012/12/global-pmis-dec17/

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    [...] With falling real wages and low consumer spending, the Fed is in a comfortable position as for inflation pressures. Therefore, in August and September, central bankers were able to do the most desperate measures ever, QE-indefinite and implicit state financing via ECB’s OMT, for now with success, even if most globalpurchasing manager indices are still contracting. [...]

  2. Guest Commentary: The Trade of the Year: Short USD/JPY | Forex Trader Website | The future of Forex is here…

    [...] With falling real wages and low consumer spending, the Fed is in a comfortable position as for inflation pressures. Therefore, in August and September, central bankers were able to do the most desperate measures ever, QE-indefinite and implicit state financing via ECB’s OMT, for now with success, even if most globalpurchasing manager indices are still contracting. [...]

  3. Guest Commentary: The Trade of the Year: Short USD/JPY | Currency Forex Markets

    [...] With falling real wages and low consumer spending, the Fed is in a comfortable position as for inflation pressures. Therefore, in August and September, central bankers were able to do the most desperate measures ever, QE-indefinite and implicit state financing via ECB’s OMT, for now with success, even if most globalpurchasing manager indices are still contracting. [...]

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