The August manufacturing PMIs came in mixed. The U.S. and China surprised on the upside while Japan disappointed with its manufacturing sector barely growing.


Manufacturing PMI
August 2010 July 2010 Trend
United States 56.3 55.5 Higher, expanding
Euro zone 55.1 56.7 Lower, expanding
Germany 58.2 61.2 Robust, slowing
France 55.1 53.9 Higher, expanding
Greece 43.0 45.3 Weaker, contracting
Italy 52.8 54.4 Softer, expanding
Spain 51.2 51.6 Softer, expanding slowly
Ireland 51.1 51.4 Softer, expanding slowly
U.K. 54.3 56.9 Softer, expanding
Japan 50.1 52.8 Weaker, barely expanding
Emerging Economies
Brazil 49.5 51.8 Moved to contraction
China 51.7 51.2 Higher, expanding slowly
Czech 57.3 56.8 Robust, improving
Poland 53.8 52.1 Higher, expanding
Turkey 51.3 52.8 Softer, expansion slowing
India 57.2 57.6 Robust, slowing
Russia 52.9 52.7 Higher, expanding
South Africa 50.3 49.5 Expanding again
Taiwan 49.2 50.5 Weaker, contracting
Global 54.1 55.1 Softer, expanding

Sources: Markit; CFLP; ISM; Plexus

The downtrend of our global GDP-weighted Manufacturing PMI for the major economies (U.S., U.K., Euro zone, Japan and China) is now firmly under way. The measure in August came in weaker at 54.1 compared to 55.1 in July, the fourth consecutive decline since the high of 57.6 in April.

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

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

The downtrend in the global weighted manufacturing PMI is indicating a rapid deceleration of global manufacturing production growth.

OECD industrial production growth in July is estimated to have slowed to 9% on a year-ago basis from a high of an estimated 10.5% in May. The GDP-weighted global manufacturing PMI suggests that industrial production growth has slowed down further in August to a pace of between 7% and 8%, with a further slowdown in September to approximately 5% to 6%.

Sources: I-Net; Plexus Asset Management; ISM; Markit.

Non-manufacturing and services PMIs due within the next few days are likely to give better insight  into where the global economy is heading.

Did you enjoy this post? If so, click here to subscribe to updates to Investment Postcards from Cape Town by e-mail.