MANUFACTURING growth slowed across the major economies in June as export orders faded, according to the series of purchasing managers’ indices (PMIs) published yesterday.
The loss of momentum was led by China, which saw its PMI drop to 52.1, compared with 53.9 in May, according to the China Federation of Logistics & Purchasing. A rival survey conducted by HSBC and Markit showed a fall to 50.4, only slightly above the 50 level that separates expansion from contraction.
In the UK, the Markit/CIPS manufacturing PMI slipped slightly to 57.5, indicating slower expansion. This was driven by a six-point fall in the new export orders balance to its lowest level since August 2009. Analysts said this could worsen over the coming months as a result of the weak recovery in the Eurozone.
Across the Atlantic, the US manufacturing ISM fell sharply to 56.2 from 59.7, fuelled by a slump in new orders and production. Export orders also fell to a six-month low.
Societe Generale economist Aneta Markowska said: “US manufacturing growth has peaked, which is normal at this stage of the cycle. However, the index is declining more rapidly than would be expected in a normal cycle. This confirms a significant loss of momentum and suggests that recent consumer weakness may be spilling over to manufacturing as well.”
Factory output in the struggling Eurozone fell by 0.2 percentage points to 55.6, in line with the flash estimate. Analysts said that output growth probably peaked in April.