Since the beginning of this year, the global manufacturing industry has recovered, which has had a positive impact on the expectation of boosting global economic growth. However, under the effect of factors such as declining growth momentum and high inflation, the pace of recovery of the manufacturing industry in different regions is different, and it is gradually showing a divergent trend.
On the whole, the global manufacturing industry is showing some signs of gradually getting rid of weak operations. According to a research report released by the China Federation of Logistics and Purchasing in early February, the global manufacturing purchasing managers' index (PMI) in January 2024 was 493%, up 1. from the previous month3 percentage points, getting rid of the operating trend of below 49% for 9 consecutive months, hitting a new high since March 2023.
Some analysts pointed out that inflationary pressure in various countries in 2024 is expected to ease compared with the past few years, and the expectation of interest rate cuts by European and American central banks within the year is gradually rising, which is conducive to the recovery of the global manufacturing industry and the benign recovery of the economies of various countries. However, the recovery of the manufacturing sector varies from region to region.
Emerging market and developing economies, including China, are facing a complex and severe situation, and their manufacturing development resilience is highlighted. According to data from the China Federation of Logistics and Purchasing, the Asian manufacturing PMI rose again to more than 50% in January. Among them, China's manufacturing PMI in January rose 02 percentage points, the level of economic prosperity has rebounded; Among ASEAN countries, except for the Philippines, the manufacturing PMI of other major countries increased to varying degrees compared with the previous month; In Latin America, the manufacturing PMI of Brazil and Mexico both increased significantly from the previous month; Although Africa's manufacturing industry has declined, the index level is still around 49% for two consecutive months, and many countries in the region have implemented a series of economic reforms to promote diversification and improve economic resilience, and the economy has maintained a steady recovery.
The European manufacturing industry once showed signs of accelerating recovery, but the growth momentum was insufficient. S&P Global data showed that the Eurozone manufacturing PMI in January was higher than market expectations, hitting a new high in nearly 10 months, but the relevant data fell sharply in February. Not only that, Germany, one of the economic engines of the eurozone, has also revised down sharply in its manufacturing PMI after rebounding for six consecutive months. Germany's heavy industry has posted zero or negative growth for the fourth quarter in a row, putting pressure on the eurozone as a whole.
Some analysts pointed out that although the European Central Bank still insists on not cutting interest rates for the time being, the containment of high interest rates on the euro area economy, especially the manufacturing industry, is becoming more and more obvious. High interest rates continue to push up borrowing and production costs for companies, and the Ukraine crisis has pushed up energy costs, forcing manufacturing companies to scale back investment, and investment and consumption have been suppressed. Many manufacturing companies in Europe have been forced to suspend production or relocate production lines, which in turn will affect the economic recovery.
On February 15, the European Commission released its Winter Economy** report, which forecasted the EU's economic growth rate in 2024 from 13% to 09%, the eurozone economic growth rate is expected to increase from 12% to 08%。The Bundesbank has since warned that the German economy could shrink slightly in the first quarter of this year and fall into a technical recession due to weak external demand, cautious consumers, and high borrowing costs for domestic investment.
Although the U.S. manufacturing index has rebounded, there are still many people who are bearish on the outlook for the U.S. economy. S&P Global released data on February 22 that the US Markit manufacturing PMI indicator in February rebounded further from January. Analysts have pointed out that it is still quite difficult for the US economy to grow under the conditions of high interest rates. Wells Fargo released a report that the U.S. economy is expected to cool sharply in the coming months as consumer spending is likely to slow down in 2024 as the U.S. job market eases and layoffs begin to increase. According to a poll conducted by the Public Affairs Research Center (AP-NORC) at the end of January, only 35 percent of U.S. adults surveyed believe the U.S. economy is doing well, and 65 percent still think the economy is doing badly.
It should also be noted that since the beginning of this year, the central banks of Europe and the United States have continued to release signals to "knock" the market and suppress the expectation of rapid interest rate cuts. This reflects the concern of the European and American central banks about the risks that may be brought by cutting interest rates too quickly, especially the core inflation data in Europe and the United States showed stronger stickiness than expected, which cannot but make them wary. However, maintaining high interest rates will not be easy. At present, the banking industry in Europe and the United States has recently been alarmed, and the interest expenses of the United States have also been rising, and the containment of the manufacturing industry by high interest rates is gradually highlighted. Especially for Europe, the biggest risk facing Europe is that it will follow the trend of policy towards the United States and allow the impact of high interest rates to continue to ferment. (This article**: Economy** Author: Lian Jun).
*:Economy**.