The global manufacturing index falls for the first time in two years

World production contracted in September for the first time in more than two years as orders and production remained weak, underscoring the growing risks of a global recession.
In this regard, according to data released on Monday, the measure of global manufacturing purchasing managers issued by “JPMorgan” fell for the fourth consecutive month, to 49.8 last month, as readings below 50 indicate a contraction and the latest number is the lowest since June 2020.
The new orders index fell for a third consecutive month to its lowest level in over two years and the measure of international trade declined, indicating weak demand as central bankers around the world raised interest rates to fight inflation. The data showed that production also contracted more in five months.
Additionally, around 90 central banks raised interest rates this year, and half of them raised interest rates by at least 75 basis points at a time. Energy costs that have risen in the last year due to the Russian war in Ukraine, as well as limited global production capacity, have particularly affected producers.
The report also showed that the arrears index shrank for a third month, the lowest since July 2020. Against the backdrop of a slight expansion in finished goods inventories, the figure indicates the accumulation of some spare capacity in the factories.
The manufacturing sector in the Eurozone also fell the most in September. Only Ireland among the eurozone countries under observation indicated expansion.
The latest data from Standard & Poor’s Global (S&P Global) showed that France and Germany, the two largest economies in the eurozone, showed the largest contractions in more than two years.
As the global index fell, industrial activity measures for both the US and China showed expansion in September. The US manufacturing sector’s S&P Global measure improved to 52, while China’s official manufacturing PMI rose to 50.1, barely entering expansion territory.
agencies