The global manufacturing sector saw continued but modest expansion in October, with output and new orders both rising for the third consecutive month, according to the latest JP Morgan Global Manufacturing PMI released in collaboration with S&P Global Market Intelligence, ISM, and IFPSM.
The headline PMI rose slightly to 50.8 in October, up from 50.7 in September and just below August’s 14-month high of 50.9, according to the PMI report.
The reading remained above the 50.0 threshold, indicating an overall improvement in operating conditions across the manufacturing industry worldwide.
“The J.P. Morgan global manufacturing output PMI rose 0.2-point to 51.5 in October, partially unwinding September’s decline,” said Maia Crook, Global Economist at J.P. Morgan. “The index continues to suggest resilience in global industry despite trade war headwinds and a widespread slowing in labor demand.”
Growth was broad-based across consumer, intermediate, and investment goods industries. The Asia region excluding China and Japan, along with the United States, emerged as key drivers of expansion.
In Asia, the average rate of output growth reached a 14-month high, with India, Thailand, and Vietnam among the stronger performers.
The PMI report also found the US and euro area recorded faster growth, while the UK returned to expansion after nearly a year of contraction.
However, the report noted that growth slowed in China, and manufacturing output declined in Japan and Brazil.
New business continued to increase modestly, though international trade trends remained weak, with export orders contracting for the seventh straight month and at a faster pace than in September.
“Forward-looking indicators, however, were more downbeat,” Crook said. “While the new orders index ticked up 0.1-point, the future output PMI fell back 1.3-point, suggesting a still-cautious outlook from producers even as current output holds up.”
Despite the overall upturn, the PMI report noted that market demand conditions were not strong enough to stimulate new job creation, as staffing levels remained unchanged in October. Employment rose in China, the US, Japan, and India but declined in the euro area, the UK, and Brazil.
Commenting on regional performance, Crook noted, “On a national level, a large step up in the U.S. output PMI contrasted with an equally large fall in China, as well as still-lackluster PMI levels in the euro area and Japan.”
