Europe Grinds To A Halt
Eurozone PMI plunged to a two-year low this morning, indicating a worse-than-expected slowdown and triggering declines for the euro on easing expectations.
Manufacturing PMI -- regarded as an early indicator of recession -- fell to 49.0 in August from 50.4 in July, indicating that while GDP is still expanding manufacturing is stalled.
According to Credit Suisse, inventories are at their highest since December 2008, but the lack of demand for goods means that manufacturers will probably have to cut production to reduce overhead in the months ahead. If we regard this orders-to-inventories statistic as an early indicator for manufacturing PMI and ISM, then we're likely to see these numbers slip further over the next few months
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