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Thursday, January 10, 2013

JPM Global Manufacturing PMI

The latest global manufacturing data is still pretty bad.  Here is the PMI chart.

Source


Here is a summary of the changes of the sub indexes for Dec.


At 50.2 the index was slightly in expansion territory.  However,  new orders were not.  The strongest sub index was input prices which is the worst one to be positive.  Is a margin squeeze coming?  We can see in the chart that this is clearly the lowest year end reading since the last recession ended.

This next chart I think is pretty clearly showing the global economy is not doing well.



The global industrial production (IP) on the right scale has crashed over the last few months.  As the red line indicates the only other times we had a value this negative we were in a recession (2001 and 2008).  With new orders still contracting, is a turn back up coming in the immediate future?  It is getting extremely hard to argue we are not in a global recession.  Will the markets start to reflect that this year?

Bob

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