The global manufacturing sector continued to record below trend growth at the start of 2012. At 51.2 in January, the JP Morgan Global Manufacturing PMI™ rose to a seven month high, but remained below its long-run average (51.8).
Manufacturing output expanded for the second successive month in January, as new orders rose for the first time since last August. The cyclically sensitive new orders-to-inventory ratio also moved higher, reaching a ten-month peak. Although rates of expansion for both output and new orders were the
fastest since last June, they were still only modest at best..
Global manufacturing employment rose for the twenty-sixth consecutive month in January, with jobs growth mainly driven by the US and Germany. Staffing levels were broadly unchanged in the Eurozone, Japan, the UK, India and Taiwan, whereas marginal job losses were signalled by China, Canada and South Korea.
“The global PMI rose to a seven-month high at the start of 2012. The PMI shows that order growth has picked up while inventory growth has slowed—a positive combination. The underlying trend in output growth is still soft, although it will be flattered in the very near-term by the post-flood bounce in Thailand and the resulting restoration of global supply chains.”
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