Strong Far Eastern economies spur emerging market growth

Julian Harris
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GROWTH in emerging markets edged up last month, with economies in the Far East appearing to fare better than those elsewhere.

The latest HSBC emerging markets survey – formulated from Markit’s purchasing managers’ indexes (PMI) – climbed to 52.6 from 52.4 in February.

All figures above 50 indicate growth.

“Faster growth in China was countered by weaker expansions in Brazil, India and Russia,” the report said, while factory data was positive elsewhere in eastern Asia.

Manufacturing surveys for March revealed accelerating growth in Indonesia, South Korea, Taiwan and Vietnam.

Emerging markets are still expanding

Meanwhile China’s overall growth level also increased, from a PMI score of 51.4 in February to a faster 53.7 in March.

By contrast, growth slowed in India, Brazil and Russia, while eastern Europe was also hit.

Manufacturing PMIs in Poland and the Czech Republic both showed a steepening rate of decline.

“This maybe reflects some of the impact from the slowdown in the Eurozone,” HSBC’s global economist, Madhur Jha, told City A.M. yesterday.

“There are still a lot of external headwinds for emerging economies – uncertainty in the US and Eurozone may be dragging down sentiment.”

The composite PMI score, which estimates growth across most of the economy, for India slowed sharply in March – falling from 54.8 to 51.4.

In Brazil the composite PMI also sank, from a reading of 52.9 in February to 51 last month.

And in Russia the PMI level fell from 54.9 to 53.4 in March.