Yesterday we saw the release of the Manufacturing Purchasing Managers Indices (PMIs) around the world. When looking across the data and the direction of travel in the PMIs some geographical patters can be seen.
The EurozoneThe Eurozone composite PMI is rose to 48.3 in May, indicating the slowest pace of contraction since February 2012. The improvement in PMIs in May was widespread and was seen in all Eurozone countries. However, the indicator remains firmly in negative territory indicating contraction.
The UKOne of only two countries in positive territory which also saw an improvement in the PMI, the UK PMI remained in positive territory for the second month in a row after the April PMI was revised above the 50 mark.
CanadaCanada, like the UK saw an improvement in its PMI while remaining in positive territory. The country's PMI has remained relatively consistently above the neutral 50 mark since the end of the recession, with only one month late last year indicating contraction.
BRIC economiesWorryingly, these large markets are all hovering close to the neutral mark and all saw their PMI fall in the month of May. These changes reflect the weaker than expected economic data for 2013q1 but does not bode well for global growth prospects if this continues. In China, recent policy changes focused on achieving more balanced growth through higher domestic consumption will have widespread consequences for industry and trade around the world.
The USThe US ISM Manufacturing index yesterday indicated the sector was in contraction, coming in below the neutral mark at 49. While the economy has shown strong growth coming out of the recession, more recent signs indicate some slowing in the pace of expansion.
South KoreaThe fall in South Korea's PMI reading likely indicated the impact of slowing global economic conditions, particularly the weakening in China. However, the PMI remains above the 50 mark showing the sector in expansion.
Manufacturing PMIs around the globePurchasing Managers Index, 50=neutral