* Euro zone factories live amid high demand
* Japanese manufacturing is expanding at the fastest pace in two years
* China’s private PMI is expanding at the slowest pace in nine months
* PMI studies show post-COVID-19 overdose remains undone (Adding European data, comment)
LONDON / TOKYO, March 1 (Reuters) – Demand for manufactured goods led to widespread growth in factories across Europe and Asia in February, but a slowdown in China highlighted the challenges facing countries as they seeking a sustainable recovery from COVID-19 transmission.
Restrictions imposed around the world to try to prevent the spread of the coronavirus have closed large areas of the services industry, meaning it has fallen to manufacturers to support economies.
But vaccine rollouts and rising demand have given hope to businesses that have been in decline for months with a cash flow crisis and falling profits.
IHS Markit Manufacturing Purchasing Managers (PMI) last index jumped to a three-year high of 57.9 in February from 54.8 in January, making the first 57.7 “flash” estimate for one of the highest readings in history 20 -year of the survey.
German factory activity reached a three-year peak last month and in France the pace of growth accelerated. Italy and Spain also saw construction.
However, locking measures disrupted supply chains and factories struggled to get raw materials, leading to a sharp increase in delivery times.
“International shipping delays and strong global demand for raw materials have delayed manufacturers around the world,” said Samuel Tombs at Pantheon Macroeconomics.
Factories in Britain, outside the euro zone and the European Union, reported the slowest growth since May last month. Breaks and rising costs associated with Brexit and COVID-19 limited their ability to handle small build-ups in orders.
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Manufacturing activity in Japan expanded at the fastest pace in more than two years and South Korea’s exports rose for a straight quarter of a month, suggesting that Asia’s export economies were benefiting from strong global trade .
On the flip side, China’s factory activity grew at the slowest pace in nine months, hit by a domestic rebate of COVID-19 and soft demand from countries under renewed locking measures.
“Overall, the pace of activity in today’s (Chinese) manufacturing press is likely to be softer, and we expect the growth trend to pick up due to the expansion of its -out of domestic demand and construction in global demand, ”said Erin Xin, an economist at HSBC.
“However, despite recovering from the home, they have not yet reached pre-dispersed growth rates due to ongoing labor market pressures. ”
China was the first major economy to lead a recovery from the COVID-19 panic, so any signs of prolonged cooling in Asia’s growth engine are likely to be a cause for concern.
With the global reversal still in its infancy, analysts said the outlook was as companies increased yields to replenish hopes that vaccine distribution would be normalized in activity. economic.
“The recovery in sustainable commodity demand continues, which is creating a positive cycle for manufacturers in Asia,” said Shigeto Nagai, head of Japanese economics at Oxford Economics.
“As immunization releases reduce uncertainty about prospects, capital spending will increase gradually. That will benefit Japan, which is strong in capital goods exports, ”he said.
Caixin / Markit Manufacturing PMI in China fell to 50.9 in February, the lowest level since May last year but still above the 50 mark that separates growth from shortening.
Activity elsewhere in Asia remained swift.
Japan’s PMI jumped to its highest level since December 2018. In South Korea, a regional bellwether exporter, shipments jumped 9.5% for just a fourth straight month of rise.
India’s factory activity for the seventh consecutive month expanded on strong demand and increased output, although a spike in entry costs could put pressure on future corporate profits.
The Philippines, Indonesia and Vietnam saw expanding manufacturing activity in February, a sign the region was recovering from the first outbreak of the pandemic.
Reciting with Jonathan Cable and Leika Kihara; edited by Shri Navaratnam, Larry King