Global Manufacturing Expands, But Remains Challenged

Global manufacturing finally moved into expansion territory in July, posting 50.3 on the J.P. Morgan Global Manufacturing PMI, up from 47.9 in June. Production and new orders both rose from contraction, posting PMIs of 51.5 and 50.7, respectively. Thirteen of the 27 countries with manufacturing data available posted readings above 50 in July. International trade volumes continue to weaken, however, and average delivery times for vendors lengthened for the 12th successive month. Input purchase prices were higher and passed on in output charges.

“The July PMI indicates that the recovery which began in May continued into mid-summer,” said J.P. Morgan Global Economist Olya Borichevska. “Many of the PMI components reached their pre-pandemic levels for the first time in July including output and new orders. The employment PMI has not recovered, suggesting labor markets will take longer to improve. Still, to fully recoup the losses sustained in the first half of the year will still take some time, especially if the recovery is knocked off course by any future re-tightening of restrictions.”