October 28, 2024 05:27 GMT
GLOBAL: Improving Global IP Momentum, PMIs & Metals Contradictory On Outlook
GLOBAL
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Global IP growth has gradually trended higher since the end of 2022 and the CPB measure maintained that in August. It rose 0.4% m/m to be up 1.8% y/y after 1.9% in July but 3-month momentum picked up to 2.6% annualised, its highest in almost a year. However the JP Morgan global manufacturing PMI fell to 48.8 in September, the lowest since October 2023, and preliminary October PMIs showed the sector continuing to contract across the G3.
Global IP outlook
Source: MNI - Market News/Refinitiv/Bloomberg
- The global manufacturing PMI peaked at 51 in May and the deterioration since then is suggesting that global IP growth will also slow. But the LME metal index which picked up in September and October and remains elevated is pointing to IP continuing to stay around the 2% rate, so are iron ore prices.
Global IP y/y% vs LME metal price index
Source: MNI - Market News/Refinitiv
- The October manufacturing PMI is released on November 4 but preliminary data point to another reading below the breakeven-50 level. PMIs remained weak this month even if in some cases the contraction in activity lessened moderately.
- The US PMI improved slightly to 47.8 from 47.3 while Japan deteriorated to 49 from 49.7. The sector in the euro area remained depressed at 45.9 (up from 45), while in the UK activity remained slightly positive at 50.3 but fell from 51.5.
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