U.S. Manufacturing Growth Strong While Much of the Rest of the World Lags Behind
Growth in U.S. manufacturing is on the rise, while Europe and Asia’s manufacturing sectors are on the decline. The U.S. indices by Markit and the Institute for Supply Management indicated the U.S. manufacturing activity climbed to 53.2 in February, which marked a turn from the downward trend seen the previous two months. Much of the decline, however, can be attributed to severe cold and record snowfall, making it difficult for workers to get to factories and complicating the process of delivering raw materials and distributing manufactured goods.
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Much of Asia’s decline is attributed to falling demand for products produced by China, South Korea, India, Vietnam, and Indonesia, all of which are producing below the global levels. Japan, however, experienced a robust month. Elsewhere in Asia, trends were a mixed bag. China fell to just above the official manufacturing PMI of 50, the level which signals whether a sector is in contrition or expansion.
In the Euro zone, the Manufacturing Purchasing Managers Index (PMI) hit a flash point of 53 in February, but ended the month at 53.3, still below the January level of 54. January marked the highest level for the Euro zone in 33 months. Most of the growth in the Euro zone was in France and Germany, which both expect this year’s growth to be much like last year’s.
Great Britain is growing somewhat quicker than expected, creating more jobs this period than in the past 33 months. U.S. manufacturing also saw their highest levels since May 2010. A trade agreement between Canada and South Korea could boost that Asian country’s production levels in the near future.
Russia is also in contrition, according to industry reports, which is bad news as the country is apparently committed to a conflict in Ukraine. It is unclear what President Vladimir Putin’s plans are to turn around the Russian economy, as most eyes are fixed on their military activities. [/show_to]
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