01-03-2019, 09:04 AM
A survey of American manufacturers showed the slowest growth in December in 15 months, reflecting a dip in confidence among executives about how their businesses will perform in the new year. IHS Markit said its manufacturing PMI slipped to 53.8 in December from an initial reading of 53.9, and it was down from 55.3 in the prior month. Any number above 50 indicates more companies are growing instead of shrinking, but the index has now fallen to its lowest point since September 2017. That could be an ominous sign for the economy if the loss of confidence continues to spread. The level of optimism among senior executives was at the lowest ebb in more than two years.
The gloomy readings largely dovetailed with an official survey on Monday which showed growing strains on China’s manufacturing sector, a key source of jobs. The findings reinforce views the economy is losing more steam. The Caixin/Markit Manufacturing Purchasing Managers’ Index (PMI) for December, released on Wednesday, fell to 49.7 from 50.2 in November, marking the first contraction since May 2017. Economists polled by Reuters had forecast only a marginal dip from November to 50.1, just above the neutral 50-mark dividing expansion from contraction on a monthly basis.
China December factory activity shrinks for first time in 19 months: Caixin PMI | Reuters
The IHS Markit Eurozone Manufacturing PMI dropped to 51.4 in December 2018 from 51.8 in the previous month, in line with market expectations and a preliminary estimate. The reading pointed to the slowest expansion in factory activity since February 2016, as new work declined for the third consecutive month, the greatest rate in over four years amid ongoing challenges in the auto sector and wider political and economic instabilities. Also, backlogs of work decreased for the fourth straight month and to the steepest rate since November of 2014.
Euro Area Manufacturing PMI | 2019 | Data | Chart | Calendar | Forecast