Today's Edition
A.SREENIVASA REDDY (ABU DHABI)
The Global Manufacturing Purchasing Managers’ Index (PMI) reported a slight decline from 50.0 to 49.6 in December.
According to the latest data produced by J.P. Morgan and S&P Global Market Intelligence in association with ISM and IFPSM, the global manufacturing sector slipped back into contraction at the end of 2024. Output and new orders declined in December, following modest increases in October and November.
“Four out of five PMI components (output, new orders, employment, and stocks of purchases) were at levels consistent with a deterioration in overall operating conditions,” the J.P. Morgan report stated. The only positive contributor to the PMI was a lengthening of supplier delivery times, the report added.
The report highlighted regional variations, noting that business conditions were influenced by the potential imposition of US tariffs in the coming year.
It also observed that global manufacturing activity declined only marginally in December. “Taken together with the marginal gains seen in October and November, output broadly stagnated in the final quarter of the year,” the report said. Production rose in only 13 of the 30 nations for which PMI data was available.
India reported the strongest output expansion, followed by the Philippines, Spain, Greece, Taiwan, and Canada. “The solid performances of Greece and Spain bucked the trend in the wider eurozone manufacturing sector, where the rate of contraction was, on average, the steepest in 14 months,” the report noted. France, Germany, and Austria experienced the sharpest declines among all the nations surveyed.
Steep downturns were also recorded in the US and the UK, with contraction rates reaching 18- and 11-month highs, respectively. Production fell slightly in Japan but showed a modest uptick in China.
The report further noted declines in production within the intermediate and investment goods industries, while consumer goods output grew for the 17th consecutive month.
International trade volumes fell for the seventh consecutive month in December. Only eight nations saw an increase in new export orders: Spain, Russia, India, Taiwan, South Korea, Indonesia, the Philippines, and Greece, according to the J.P. Morgan report.
Employment also fell for the fifth consecutive month. “Among the major industrial regions, job losses were observed in the euro area and China, in contrast to employment growth in the US and Japan,” the report stated.
Input cost inflation accelerated to a four-month high in December, while selling price inflation eased to a nine-month low, the report concluded.
