Global manufacturing growth eased in November as the JP Morgan Global Manufacturing PMI slipped to 50.5, down from 50.9 in October, marking the lowest reading in the current four-month expansion.
In a media release, JP Morgan said the latest data reflected softer growth in manufacturing output and new orders, alongside a return to contraction in employment.
Maia Crook, global economist at JP Morgan, said the figures point to “modest but resilient growth in global industry,” noting that the manufacturing output PMI “fell back 0.3-points to 51.2 in November.”
She added that while the future output PMI made “a reassuring 1.4-point rebound,” the improvement was balanced by “a fall in the new orders index to a four-month low.”
According to the report, three components of the PMI – new orders, output and suppliers’ delivery times – continued to signal improved operating conditions, while employment and stocks of purchases remained in contraction territory.
JP Morgan noted manufacturing production and new orders rose for the fourth consecutive month, with gains driven by consumer and intermediate goods. Investment goods production, however, contracted.
Thailand, India, Vietnam, Colombia, Pakistan and the United States recorded the strongest manufacturing output readings. Output increased across the euro area and the UK, while Japan posted a contraction and China saw stagnation.
According to the report, new export business declined for the eighth straight month, though at a slower rate. Developed markets, including the US, Japan and the euro area, reported decreases, while emerging markets saw growth supported by China and India.
Crook noted varied performance across key economies, saying that “output in the US and India are still expanding at solid rates, whereas the performances in China and the rest of the G-4 remain lacklustre in comparison.”
Data showed manufacturers remained ‘cautiously optimistic,’ with business sentiment rising to a five-month high but still below its long-run average.
The report also found that employment fell for the second time in three months, reflecting declines in China, the euro area and the UK, compared to increases in the US, Japan and India. Backlogs of work continued to shrink, while inventory and purchasing indices signalled further contraction.
Input costs and factory gate prices increased again, with inflationary pressures stronger in developed economies.
JP Morgan concluded that supply chains showed ongoing strain as average vendor delivery times lengthened for the eighteenth month in a row.
