Global manufacturing production expanded at the slowest pace for 14 months in November, as growth of new orders hit a 16-month low and the trend in international trade volumes stagnated. The forward-looking orders-to-inventory ratio also edged down to its weakest level since the end of 2012.
At a 14-month low of 51.8 in November, the JP 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) – nonetheless signalled a further expansion of the sector.
Markit, the London-based market indices firm, said manufacturing production rose for the twenty-fifth successive month in November, but the rate of expansion eased to its lowest since August 2013.
North America was a key growth engine. Canada was in joint-third place of the Output PMI growth rankings, a position it shared with the Netherlands, while Mexico and the US were in fifth and sixth places respectively. This was despite the US seeing a sharp growth slowdown. The UK and Japan also reported solid expansions.
Apart from the slower US expansion, the weakness in the global manufacturing sector also mainly reflected stagnation in China and further subdued growth in the eurozone.
The lacklustre performance of the Eurozone came despite it having three of the top-ranked nations (Ireland, Spain and the Netherlands), whose solid expansions were offset by weaker growth in Germany and contractions in Austria, France and Italy. Elsewhere, Brazil, Indonesia and South Korea also reported lower output.
Manufacturing employment rose for the sixteenth month running in November, led by solid jobs growth in the US, the UK, Canada, the Czech Republic, Ireland and Turkey. Cuts were reported in China, Italy, France, South Korea, Brazil, Russia, Austria, Indonesia and Greece.
David Hensley, Director of Global Economics Coordination at JP Morgan, said: "The global manufacturing PMI fell to a 14-month low in November, as growth of production and new orders moderated and international trade stagnated. The Output PMI is now consistent with growth of global IP close to 3.3% annualized, a solid pace but not so strong as what was implied by the survey earlier in the year."
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.