PMI: Global economic growth losing momentum at the end of the second quarter

The global composite PMI index stood at 52.7 in June, the lowest in four months, reflecting slowing global growth at end Q2 2023. However, the index remains comfortably within the range of expansion, buoyed by the services sector. On the other hand, the manufacturing PMI contracted sharply in June (48.8 compared to 49.6 in May).

Eighteen out of the 31 countries for which June data are available indicated a decline in their manufacturing sector, due to the effect of a further reduction in 'new orders', with a significant downturn in the USA, Germany, Italy, Poland, and, to a lesser extent, the eurozone. In China, the manufacturing index fell slightly but remained within the range of expansion. Conversely, France, Denmark, Indonesia, and Vietnam are among the countries that posted a PMI manufacturing index up on the previous month. The news on prices and supply was better. The global manufacturing PMI for delivery times fell for the fifth consecutive month to its lowest level since February 2023. However, the low level of this sub-index is evidence of weakened demand, beyond the beneficial effect of easing supply difficulties. The input price index and the sale price index in the manufacturing sector fell for the second month in a row. It should be noted that the drop is greater, on average, in developed economies.

The global services PMI index stood at 54.0 in June, down from 55.5 in May, reaching its lowest level since February 2023. With the exception of France, where the index contracted for the first time in five months, most of the countries studied remain in expansion. The sector remains buoyed by the increase in new contracts for service providers, new export orders, and employment. However, the expansion is losing momentum in light of the drop in these various indices in June compared to May. Input prices rose slightly, while sale prices fell.

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