LONDON / TOKYO (Reuters) – Manufacturers across Europe reached a 2020 high-end as Asian factory activity expanded largely due to strong demand in mainland China, studies showed, but expected harder coronavirus loops would indicate the recovery.
Despite hopes that vaccine programs will eventually trigger the virus, the resurgence of diseases is forcing many countries to tightly control economic activity, possibly hurting major exporters such as China and Europe. Germany.
“Global production was still on roll until mid-December which is an excellent basis for economic recovery once the current wave of pandemic is declining,” said Holren Schmieding at Berenberg.
“We may have a slightly challenging situation in January as renewed locks affect manufacturing but China remains relatively strong and the US does not show any important signs that consumers are slowing down the outlook for manufacturing remains good. ”
Activity in euro zone manufacturing increased at the fastest pace since mid-2018 last month, indicating that the bloc’s economy was not as hardened by the pandemic as it was earlier in the year.
IHS Markit Manufacturing Purchasing Managers (PMI) last index rose to 55.2 in December from 53.8 in November, although lower than the initial estimate of 55.5 “flash”.
Anything above 50 indicates growth, and December was the highest reading since May 2018. An index measuring yield rose, which feeds into Wednesday’s mixed PMI. is seen as a good guide for economic health, to 56.3 from 55.3.
Germany was once again the driving force at the bloc and in contrast to the largest service industry – which is particularly badly affected by lockout measures to deal with the crown virus – factories in the region have stay mostly open.
The British PMI broke to a three-year high of 57.5, but that rise seemed to be largely due to factories running to finish orders before the UK move time on its way to leaving the UK. European Union to the end. [GB/PMIM]
Prime Minister Boris Johnson reached an eleven-hour deal with the EU on December 24, abolishing taxes on trade in goods with the EU. However, additional paperwork will still be required to trade between the two economic sectors.
Global stock markets hit a record high on Monday, the first trading day of the new year, as investors hoped the vaccination spread of the global economy would slow down the COVID-19 pandemic. [MKTS/GLOB]
“By a rapid return to services and the continued strength in manufacturing means in the Spring when we hope the pandemic will spread we are making a strong kick in GDP,” ”Said Schmieding at Berenberg.
STRAIN ASIAN
Expanding manufacturing activity in Japan, South Korea and Taiwan, according to PMI studies, the latest manufacturers in Asia continue to kick back from the damage caused by the COVID- pandemic 19 last year.
But a slowdown in factory activity growth in China highlighted the challenges. The Caixin / Markit PMI in China fell in December to 53.0 – the lowest level in three months – but remained well above the 50 level.
“The external release of COVID-19 and the replacement of locks have had an impact on external demand,” said Erin Xin, an HSBC economist in China in a research note.
The reading, lower than November’s 54.9, fell broadly in line with the official measure of factory activity that showed modeling activity at a high level.
Elsewhere, production in Japan settled for the first time in two years, and India’s factory sector ended a rough 2020 on a stronger note as manufacturers encouraged production to meet growing demand. growing.
Reciting with Jonathan Cable and Leika Kihara; Edited by Ana Nicolaci da Costa and Hugh Lawson