The upturn in the global manufacturing
sector lost some traction at the end of the first quarter of 2014. At 52.4 in
March, down from 53.2 in February, the J.P.Morgan Global Manufacturing PMI
(purchasing managers' index) - - a composite index produced by JPMorgan and
Markit in association with ISM (US Institute of Supply Management) and IFPSM
(International Federation of Purchasing and Supply Management) - - fell to a
five-month low, but remained above its average for the current 16-month sequence
Global manufacturing production increased for the
seventeenth consecutive month in March. However, the rate of expansion eased to
a five-month low, mainly on the back of a slowdown in Asia. Growth of total new
orders also eased slightly, despite improved inflows of new export business.
Japanese output growth continued to cool sharply from
January’s series-record – reaching a six-month low – but remained above the
global average nonetheless. Production in China, meanwhile, contracted for the
second straight month and to the greatest extent since November 2011.
Slower rates of output expansion were also signalled for
Taiwan and India, while South Korea and Indonesia stayed close to stagnation.
Vietnam recorded a faster pace of output growth.
US manufacturing production increased at a clip close to
February’s near three-year record, and although the strong upturn in the UK
slowed again the rate of expansion remained well above its long-run trend and
the global average.
Rates of output growth edged higher in the eurozone (with
production rising in all of the member nations covered by the PMI surveys) and
Brazil, slowed slightly in Canada and Mexico, while Russia contracted at the
fastest pace since May 2009.
March data signalled an increase in manufacturing
employment for the eighth month running, with the rate of jobs growth the
fastest during that period. Among the larger industrial regions, employment rose
in North America, the eurozone, Japan, the UK, South Korea, Taiwan and Brazil,
but fell in China.
Average input cost inflation slowed to a nine-month low in
March, while manufacturers’ selling prices fell for the first time since July
last year. These trends mainly reflected a lessening of price pressures in Asia
David Hensley, Director of Global Economics
Coordination at JP Morgan, said: "The
March PMI confirms the anticipated downshift in the global manufacturing sector,
as the headline index resumes its slowing trend following the weather-related
distortions from the US and Japan surveys in recent months. Although growth is
cooling from the highs reached at the end of last year, the picture remains one
of continued expansion, suggesting manufacturing will remain a contributor to
both global economic growth and job creation."
The Global Report on Manufacturing is compiled by
Markit based on the results of surveys covering over 10,000 purchasing
executives in 32 countries. Together these countries account for an estimated
89% of global manufacturing output.