Global Manufacturing activity sees slower downturns in November

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The Global manufacturing sector is moving closer to stabilisation in November, according to the latest composite index from JP Morgan and S&P Global. 

The JP Morgan Global Manufacturing PMI posted a 49.3 rating in November, up from October’s 48.8. The result marks a six-month high for the index but also the 15th month in a row of recording below the neutral 50.0 mark. 

In a media release, JP Morgan said all five of the PMI components continued to signal a deterioration in overall operating conditions. However, the decline moderated in four components (new orders, output, stocks of purchases, and employment) over the course of a month. 

Global manufacturing production saw a further downturn, primarily in the immediate goods sector, where output contracted for the sixth month in a row, albeit at a slower pace. Meanwhile, consumer and investment goods producers both saw increases. 

Ten out of 31 nations in the Manufacturing PMI survey saw expansions in production, including the US, mainland China and India. Output contracted across Europe and the United Kingdom along with Japan. 

An increase in job losses was recorded for the third month running, with cuts signalled in the US, the euro area, China, and Japan. 

This comes with a decrease in the level of incoming new businesses, which resulted in a 17-month decline, although the rate of decline eased and was one of the slowest during the sequence.  

Vendor delivery times improved again as global supply chains continued to repair following the strains caused by the global pandemic and subsequent solid economic recovery.

The global inflationary pressures also moderated in November as rates of increase in input costs and selling prices both slowed to three-month lows. 

In the case of purchasing costs, the rate of inflation remained higher in emerging markets compared to their developed market counterparts. 

“The November PMIs offer a glimmer of hope that global industry may have found a bottom at the start of 4Q23. The manufacturing output index rose one point to 49.9, more than reversing the October drop and tempering concerns that activity was sliding back into contraction,” said Bennett Parrish, global economist at JP Morgan. 

“At this level, the output PMI is consistent with very soft growth in global manufacturing. A sizable increase in the European PMIs is encouraging given that the outlook in the region has been particularly weak. Asia – a bellwether for global Industry – also saw a notable rise.”