The world’s large economies such as the US, India, China and the Eurozone are showing signs of “tentative stabilisation” and an uptick in new orders, an HSBC survey has said.
The recent crop of PMIs provided a somewhat better tone, HSBC said in a research note adding that the global PMI, has showed a uptick in new orders.
Interestingly, in the Eurozone, too, the manufacturing PMI recovered a little, although it still points to an ongoing fall in output.
The report, however, noted that some caution should be adopted while reading too much into the uptick of the PMIs in bigger economies as a sharp revival in the global industrial activity in the next two to three months is not likely.
“Expectations of a sharp rebound in global industrial activity into year-end seem thus premature. A more convincing upturn will likely only occur next year,” HSBC said.
Though there has been signs of “tentative stabilisation” in the world’s larger economies, some Asian economies like Korea, Taiwan, and Singapore witnessed decline in new orders “warranting caution about Q4 growth,” HSBC said.
In Asia, the larger economies of Japan, China, India, and Indonesia — or “Big Asia” — registered a similar up-tick in PMI readings. Their new orders also stabilised last month.
However, the industrial powerhouses of Taiwan, Singapore, and Korea, which are highly sensitive to swings in the global industrial cycle — the new order measures plummeted.
While the manufacturing PMIs have clearly softened in recent months, services PMIs have held up much better, reflecting still relatively robust local consumption spending.
Going forward, “services look set to expand further in the fourth quarter, but in the manufacturing sector an upswing does not appear imminent,” HSBC said.
The HSBC India services Purchasing Managers Index for September inched upwards to 55.8 from 55 in August. While, the HSBC India Manufacturing Purchasing Managers’ Index — a measure of factory production — stood at 52.8 in September, same as in August.