Global manufacturing remains in slow growth gear during April
The growth rate of the global manufacturing sector ground to a near-standstill at the start of the second quarter. At 50.1 in April, the J.P.Morgan Global Manufacturing PMI™ – a composite index produced by J.P.Morgan and Markit in association with ISM and IFPSM – posted a reading barely above its no-change level of 50.0 and the second weakest during the past forty months.
Rates of expansion in output and new orders also decelerated back towards the broadly stagnant outcomes registered in February. Conditions remained muted in many domestic markets, while international trade flows continued to deteriorate. The level of new export business fell for the third straight month and to the greatest extent since September of last year.
The performances of the main industry groups covered by the survey all remained lacklustre during April. Output growth slowed to marginal rates at both consumer and intermediate goods producers, while the investment goods sector stagnated.
Developed and emerging markets both exhibited a degree of weakness during the latest survey month. Developed nations (on average) saw their combined pace of output expansion slow to a three-year low. Production growth slipped to a 16-month low in the European Union, to a (Markit) survey low in the US and declined at the fastest pace in two years in Japan.
April saw output fall back into contraction territory in the emerging markets, the tenth time in the past 12 months that a decrease has been registered. China stagnated, growth slowed in India and Indonesia, while Brazil, Russia and Malaysia recorded substantial downturns in production.
Global manufacturing employment fell for the third consecutive month in April. Although the pace of job losses was again only moderate, it was nonetheless the steepest signalled since June 2013. The US saw only a negligible gain in staffing levels, while employment in China fell at the second-fastest pace since January 2009.
Brighter labour market news was provided by the eurozone and Japan, which both saw jobs growth accelerate. Among the euro area nations for which April data were available, only France registered a decrease in workforce numbers during the latest survey month.
Price gauges tracked higher in April, with both input costs and output charges rising to halt recent sequences of decline. However, a marked disparity was evident between the trends seen (on average) in developed and emerging nations. While prices tended to fall in the developed world, emerging markets generally registered solid rates of inflation.