Biggest U.S. Manufacturing Growth Advantage Versus Euro Area in a Half Year

Biggest U.S. Manufacturing Growth Advantage Versus Euro Area in a Half Year

September 1, 2017

The U.S. manufacturing purchasing managers index jumped 2.5 points in August to a 76-month high of 58.8. That increase was three times greater than the 0.8-point rise of Euroland’s manufacturing PMI to a 2-month high of 57.4, resulting in a 1.7-point U.S.-minus-Euroland PMI spread to 1.4 points. That spread is the most U.S.-advantageous since February.

A 4.7-point rose in the jobs component accounted for most of the U.S. index’s improvement last month. Production went up just 0.4 points, while orders dipped 0.1 point. Price pressure was the same as in July.

The three largest economies in the euro area experienced greater increases in their PMI readings than Euroland as a whole, printing higher by 1.2 points in both Germany and Italy and by 0.9 points in France. However in Spain, the group’s fourth major economy, the manufacturing index fell by 1.6 points to an 11-month low of 52.4. It makes sense that Euroland has been losing manufacturing strength vis-a-vis the United States because manufacturing is heavily influenced by flows of trade. The euro’s appreciation is a drag on the competitiveness of Ezone exports and import-competing goods.

Mfg PMIs U.S. Euroland Spread EUR/USD
Jan 2013 53.1 47.9 +5.2 1.330
February 53.1 47.9 +5.2 1.334
March 51.5 46.8 +4.7 1.295
April 50.0 46.7 +3.3 1.301
May 50.0 48.3 +1.7 1.299
June 52.5 48.8 +3.7 1.319
July 54.9 50.3 +4.6 1.309
August 56.3 51.4 +4.9 1.331
September 56.0 51.1 +4.9 1.335
October 56.6 51.3 +5.3 1.364
November 57.0 51.6 +5.4 1.349
December 56.5 52.7 +3.8 1.370
Jan 2014 51.3 54.0 -2.7 1.361
February 54.3 53.2 +1.1 1.366
March 54.4 53.0 +1.4 1.380
April 55.3 53.4 +1.9 1.380
May 55.6 52.2 +3.4 1.374
June 55.7 51.8 +3.9 1.360
July 56.4 51.8 +4.6 1.354
August 58.1 50.7 +7.4 1.332
September 56.1 50.3 +5.8 1.290
October 57.9 50.6 +7.3 1.268
November 57.6 50.1 +7.5 1.247
December 55.1 50.6 +4.5 1.232
Jan 2015 53.5 51.0 +2.5 1.162
February 53.3 51.0 +2.3 1.135
March 52.3 52.2 +0.1 1.083
April 51.6 52.0 -0.4 1.081
May 53.1 52.2 +0.9 1.116
June 53.1 52.5 +0.6 1.123
July 51.9 52.4 -0.5 1.101
August

September

October

51.0

50.0

49.4

52.3

52.0

52.3

-1.3

-2.0

-2.9

1.114

1.123

1.121

November

December

Jan 2016

February

March

April

May

June

July

August

September

October

November

December

Jan 2017

February

March

April

May

June

July

August

48.4

48.0

48.2

49.7

51.7

50.7

51.0

52.8

52.8

49.4

51.7

52.0

53.5

54.5

56.0

57.7

57.2

54.8

54.9

57.8

56.3

58.8

52.8

53.2

52.3

51.2

51.6

51.7

51.5

52.8

52.0

51.7

52.6

53.5

53.7

54.9

55.2

55.4

56.2

56.7

57.0

57.4

56.6

57.4

 

-4.4

-4.8

-4.1

-1.5

+0.1

-1.0

-0.5

0.0

+0.8

-2.3

-0.9

-1.5

-0.2

-0.4

+0.8

+2.3

+1.0

-1.9

-2.1

+0.4

-0.3

+1.4

1.076

1.090

1.087

1.111

1.114

1.134

1.130

1.124

1.106

1.120

1.121

1.103

1.078

1.054

1.063

1.064

1.069

1.072

1.106

1.124

1.153

1.182

 

Copyright 2017, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

Tags: U.S. and Euroland manufacturing PMIs




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