According to a survey of 350 manufacturers carried out by the CBI, Britain's manufacturing sector is growing at its fastest rate for nearly two decades. The Telegraph reports that total order books relative to normal levels were at their strongest since March 1995.
The CBI survey's total order book balance rose to +11 this month to from -4 in October, well above expectations of 0 and the long-run average of -17.
Meanwhile in the Eurozone things are somewhat different. Markit Economics said that its Eurozone Composite Purchasing Managers Index (PMI) for November (published today) fell to a three-month low of 51.5 points from 51.9 points in October.
France, the Eurozone's second largest economy, is dragging the zone down whilst the other smaller economies are all but stagnant.
Such is the effect of using one economic policy (via the single currency) for multiple economies that face different problems.
Showing posts with label pmi. Show all posts
Showing posts with label pmi. Show all posts
Thursday, November 21, 2013
Monday, August 5, 2013
UK Economy Heads Towards Escape Velocity
Following last week's jump in the UK's construction PMI, there is further good economic news.
The UK services sector grew at its fastest pace in more than six years in July. The Markit/CIPS services purchasing managers' index (PMI) rose to 60.2 in July from 56.9 in June, its highest level since December 2006. This is a larger gain than forecast by any of the economists polled by Reuters.
Paul Smith, senior economist at Markit is quoted by Reuters:
The UK services sector grew at its fastest pace in more than six years in July. The Markit/CIPS services purchasing managers' index (PMI) rose to 60.2 in July from 56.9 in June, its highest level since December 2006. This is a larger gain than forecast by any of the economists polled by Reuters.
Paul Smith, senior economist at Markit is quoted by Reuters:
"Although an early call on one month's data, the forward-looking elements from the survey point to a further strengthening of GDP in Q3 as the UK heads towards 'escape velocity' and self-sustaining economic expansion."The PMI survey showed a continued increase in services employment. However, the increase in demand is also causing firms to increase prices; ie people's incomes will remain "under pressure".
Friday, August 2, 2013
UK Construction Jumps
UK construction activity rose in July to its highest level since June 2010.
Reuters reports that the Markit/CIPS construction PMI rose to 57.0 July, up from 51.0 in June. The rise is mainly on the back of an increase in residential construction which has spurred an increase in confidence of purchasing managers.
Whilst the increase in residential construction is hardly surprising, given the increased stimuli to the sector offered by the Chancellor, the size of the increase in PMI is above expectations and as such is very welcome.
Tim Moore, senior economist at Markit said:
The question is, will this stimulation create an inflationary asset bubble?
Reuters reports that the Markit/CIPS construction PMI rose to 57.0 July, up from 51.0 in June. The rise is mainly on the back of an increase in residential construction which has spurred an increase in confidence of purchasing managers.
Whilst the increase in residential construction is hardly surprising, given the increased stimuli to the sector offered by the Chancellor, the size of the increase in PMI is above expectations and as such is very welcome.
Tim Moore, senior economist at Markit said:
"July's survey highlights a new wave of optimism across the UK construction sector, with companies reporting a pace of expansion in excess of anything seen over the past three years."Like it or not, the UK economy's bedrock is the property sector; by stimulating that sector the Chancellor has in effect stimulated the economy.
The question is, will this stimulation create an inflationary asset bubble?
Thursday, September 20, 2012
Stagnation Abounds
The purchasing managers indexes (PMIs), released today make depressing reading.
Reuters reports that the composite Eurozone PMI fell to 45.9 in September, from 46.3 in August. A level of less than 50 denotes contraction.
The ongoing decline in PMI indicates that the ECB "plan" to buy Eurozone debt has not impressed companies, or restored their faith in an upturn.
It is not just Europe that is suffering, the ongoing recession in Europe has negatively impacted China (seen by many as the last best hope for pump priming a global economic recovery). Although the China manufacturing PMI rose in September to 47.8 from August's nine-month low of 47.6, it remains below 50 which indicates that Chinese growth is slowing/stalling.
In theory China and the Eurozone should work together to try to address their mutual problems. Unfortunately, China is less than pleased that there is still an arms embargo and that its products are subject to tariffs.
Reuters reports that the composite Eurozone PMI fell to 45.9 in September, from 46.3 in August. A level of less than 50 denotes contraction.
The ongoing decline in PMI indicates that the ECB "plan" to buy Eurozone debt has not impressed companies, or restored their faith in an upturn.
It is not just Europe that is suffering, the ongoing recession in Europe has negatively impacted China (seen by many as the last best hope for pump priming a global economic recovery). Although the China manufacturing PMI rose in September to 47.8 from August's nine-month low of 47.6, it remains below 50 which indicates that Chinese growth is slowing/stalling.
In theory China and the Eurozone should work together to try to address their mutual problems. Unfortunately, China is less than pleased that there is still an arms embargo and that its products are subject to tariffs.
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