Global fac­tory growth lost mo­men­tum in March: PMI

Daily Trust - - BUSINESS NEWS -

Global man­u­fac­tur­ing growth lost mo­men­tum last month as new or­ders came in at a slower pace but fac­to­ries in­creased staffing to meet the con­tin­ued ex­pan­sion, a busi­ness sur­vey showed on Tues­day.

JPMor­gan’s Global Man­u­fac­tur­ing Pur­chas­ing Man­agers’ In­dex (PMI) dipped to 52.4 in March from 53.2. It held above the 50 mark that in­di­cates growth for the 16th month.

“Al­though growth is cool­ing from the highs reached at the end of last year, the pic­ture re­mains one of con­tin­ued ex­pan­sion, sug­gest­ing man­u­fac­tur­ing will re­main a con­trib­u­tor to both global eco­nomic growth and job cre­ation,” said David Hens­ley, a di­rec­tor at JPMor­gan.

A sub-in­dex mea­sur­ing em­ploy­ment rose to 51.5 from 51.3. The new or­ders sub-in­dex sank to 53.2 from 54.6.

Man­u­fac­tur­ing ac­tiv­ity in Asia and Europe fin­ished the first quar­ter on a weaker note but ac­tiv­ity in the United States re­mained rel­a­tively steady, sug­gest­ing se­vere win­ter weather in North Amer­ica had only a mod­est ef­fect on U.S. fac­to­ries. Fac­to­ries across Europe eased back on the throt­tle in March while China’s vast man­u­fac­tur­ing in­dus­try con­tracted for a third straight month, sur­veys showed, fuel­ing ex­pec­ta­tions pol­i­cy­mak­ers may be forced to act in com­ing months.

The per­for­mance in the U.S. con­trasts with the lack­lus­ter data else­where and ar­guably gives U.S. mon­e­tary au­thor­i­ties more room to re­duce stim­u­lus than their cen­tral bank­ing coun­ter­parts abroad, who are try­ing to prop up growth.

The two U.S. sur­veys, one from Markit and one from the In­sti­tute for Sup­ply Man­age­ment, con­tra­dicted each other in spots, but both over­all fig­ures were solidly above 50, in­di­cat­ing on­go­ing growth.

“It is con­sis­tent with an econ­omy mak­ing progress but one grow­ing be­tween 2 and 2.5 per­cent,” said Richard Fran­ulovich, se­nior cur­rency strate­gist at West­pac Bank­ing Corp in New York.

“That’s re­spectable but not as much as the Fed would like.”

U.S. mar­kets judged the news as pos­i­tive.

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