NAM: Global Manufacturing Economic Update
The J.P. Morgan Global Manufacturing PMI expanded in August at the fastest pace since November 2018, and the sector continues to bounce back even as challenges persist worldwide due to COVID-19 and the severe worldwide recession.
In August, sentiment among the top 10 markets for U.S.-manufactured goods improved in every economy except France. Six markets expanded — the same pace as in July and up from one (China) in May.
In Brazil, manufacturers reported that new orders and output soared at record paces, and employment grew at its best rate since February 2010.
Chinese manufacturing activity rose at the fastest pace since January 2011. Industrial production grew 4.8% year-over-year, but fixed-asset investment and retail sales continued to reflect pullbacks in activity, despite some progress.
While economies around the world have rebounded strongly in recent months, the data reflect the damage caused by the pandemic. For instance, Eurozone industrial production has fallen 12.3% year-over-year despite jumping by 9.1% in June. Output in Mexico has also plummeted 17.5% over the past 12 months. Likewise, production in the United Kingdom continues to be down 11.6% since February, while manufacturing sales in Canada are still 13.2% lower than levels seen before COVID-19.
The U.S. trade deficit rose to the highest level since July 2008, with the goods trade deficit soaring to a new record. Growth in goods imports outpaced the gains in goods exports. The data continue to reflect the drop-off in trade activity year to date, with U.S.-manufactured goods exports down 17.3% through the first seven months of 2020 relative to the same period in 2019.
Since April 24, the U.S. dollar has fallen 6.5% against a broad-based index of currencies for goods and services, according to the Federal Reserve.
Manufacturers continue to advance efforts with the administration and Congress to open markets, ensure trade certainty and address challenges overseas, including the following:
Monitoring the U.S.–China security, trade and economic relationship
Leading industry engagement on World Health Organization reform
Leading industry advocacy in support of congressional passage of a comprehensive Miscellaneous Tariff Bill
Submitting comments on the United States–Mexico–Canada Agreement labor interim procedural guidelines
Submitting comments on the U.S. Export–Import Bank’s Partnership with the Private Export Funding Corporatio