Global factories raise production for 4th successive month: S&P Global

There were more worrying signs on the demand front, however, as total new orders and international trade flows deteriorated further, it noted.

The J.P.Morgan global manufacturing purchasing managers’ index (PMI) posted 49.6 in May, unchanged from April and March. The headline PMI has remained below the neutral 50 mark in each of the past nine months.

Growth of manufacturing production accelerated to an 11-month high in May, as a strengthening performance (on average) in Asia offset weaker expansion in North America and a further downturn in Europe. The overall rate of increase remained relatively subdued, S&P Global said in a release.

Output growth recovered to an 11-month high in China, Japan saw expansion following ten months of contraction, while India and Thailand registered strong increases.

Growth slowed in the United States, while Greece was the only euro zone nation covered by the survey to register expansion.

The United Kingdom, Australia and Brazil all saw production contract. The level of incoming new business fell for the eleventh month running in May, although the pace of contraction has remained relatively mild in recent months.

A similar regional pattern was observed for new orders to that for output. Asian economies like China, Japan and India saw new business increase, while intakes fell in the United States, the euro area, the United Kingdom and Brazil.

International trade volumes continued to weigh on demand, with new export orders dropping for the fifteenth consecutive month and at the fastest pace in 2023 so far.

The United States, the euro area, Japan, the United Kingdom and Brazil were among the nations to see contractions, whereas China and India were among those reporting growth.

Business optimism continued to wane in May. Although global manufacturers expect production to increase (on average) over the next 12 months, confidence dipped to its weakest since December.

There was better news on the costs and supply chain fronts in May. Average purchase prices fell, albeit slightly, for the first time in three years.

Average vendor lead times shortened to the greatest extent since April 2009, amid reports of improved material availability and lesser supply chain pressure. Average selling prices also fell marginally for the first time since mid-2020.

Fibre2Fashion News Desk (DS)