The upturn in global manufacturing production was sustained at the end of the opening quarter.
Output rose for the second successive month, as manufacturers benefited from a near-stabilisation of new order inflows and improving supply chain conditions.
The J.P.Morgan Global Manufacturing PMI – a composite index produced by J.P.Morgan and S&P Global in association with ISM and IFPSM – fell to 49.6 in March, down from 49.9 in February, staying below the 50.0 no-change mark for the seventh successive month.
The PMI level was impacted by slower growth of output and employment alongside a further improvement in supplier delivery times. Although new orders and stocks of purchases both fell, rates of contraction eased closer to stabilisation.
Manufacturing production expanded for the second consecutive month in March, albeit to a fractionally less marked extent than in the prior survey month. Output growth eased in both the consumer and investment goods sub[1]industries.
Although intermediate goods production fell for the ninth month running, the rate of decline was the joint-weakest during that sequence. Among the largest industrial regions covered by the survey, the US and the euro area both eked out marginal expansions during March. Although mainland China outperformed both, its rate of expansion was also only marginal and much slower than in February.
Downturns were registered in Japan, South Korea, the UK and Brazil. Thailand and India saw the quickest rates of expansion. March saw new order intakes decrease for the ninth consecutive month. However, the rate of contraction was only mild and the weakest during that sequence.
The US and Japan both saw new business intakes fall at slower rates, while the downturn (on average) across the euro area accelerated slightly. New work received rose for the second straight month in China, albeit at a reduced pace, and returned to (fractional) growth in the UK. Data suggested that any demand revival tended to be focused on 'domestic' new order intakes in certain nations, as international trade flows deteriorated at a faster rate.
Supply chains continued to recover from the immense pressure experienced through much of the past three-and-a-half years, as average vendor lead times shortened to the greatest extent since May 2009. Purchasing activity and stocks of both inputs and finished products all declined at slower rates during March.
Manufacturing employment increased for the second successive month in March. Jobs growth was registered in the US, the euro area and Japan (among others), offsetting losses in China, the UK, India and Brazil. Price pressures eased further in March, as rates of increase in input costs and output charges slowed to 32- and 29-month lows respectively. For both price measures, rates of increase remained (on average) higher in developed nations compared to their emerging market counterparts.
Bennett Parrish, Global Economist at J.P.Morgan, said: “The March global manufacturing PMI suggests that output slipped slightly last month. That said, the PMI level remains consistent with soft global IP growth and hopes remain that the goods sector upturn that started early this year will be sustained as new order intakes stabilize and cost inflation and supply chain pressures ease further in coming months.
“Much will depend on whether the US and Euro area can maintain positive momentum, and if China can continue recovering once the initial boost from re-opening has abated. The signal from the bellwether Asian export economies was mixed In March."
