Global PMIs: A summer of calm - HSBC

Globally, momentum may have faded a touch since the start of the year but the PMIs continue to point to solid growth, particularly in the developed world and a possible pick-up ahead is possible based on the forward looking components.

Key Quotes

“The global composite PMI eased a little in July, to 53.5 from 53.7 in June. Momentum has clearly faded after the extremely strong first few months of the year, but nonetheless the PMIs point to a robust pace of global growth, with readings comfortably above the trends of the past few years.”

“The global manufacturing PMI edged up to 52.7, despite the eurozone number falling for the first time in ten months and a much weaker reading in India as the economy comes to terms with the implementation of the Goods and Services Tax. The US data showed a mixed picture, with a better Markit reading and a weaker ISM number, while the Chinese Caixin manufacturing PMI picked up after two months of weaker readings.”

“On the services front, the global PMI fell by another 0.1pt but remains at very high levels (53.7), with both the new orders and the employment component rising to the highest level in two years. The US posted another strong rise, with the index increasing by 0.5pts to 54.7, the highest print since January. The eurozone stayed flat, with the further slip in Germany, France and Spain offset by a bounce in Italy to the highest level in over 10 years. The services index fell further in emerging markets, and now stands at the lowest in 2017.”