The US Institute of Supply Management (ISM) purchasing managers’ index (PMI) dipped to 58.2 in November from 58.7 in October. However, the reading still indicates growth in manufacturing activity. Economists had expected the index to inch down to 58.4.
Despite the small decline, the manufacturing score still leaves it at an elevated level consistent with solid economic growth. Many analysts are of the view that the depreciation in the US dollar this year, together with the strength of demand in the rest of the world, means the outlook for the manufacturing sector still remains bright.
In the meantime, growth in the UK’s services sector slowed slightly last month after reaching a six-month high in October, as increased operating costs weighed on service providers and Brexit uncertainty dampened growth and confidence. The IHS Markit/Chartered Institute of Procurement & Supply PMI dropped more than expected to 53.8 in November from 55.6 in October.
Economists had expected the gauge to drop marginally to 55.0. This shows that firms in the sector were still expanding but growth has eased. These services data contrast with record-high order books recently reported in the manufacturing sector, and figures showing a return to growth among construction firms.
Finally, consumer price inflation in the countries that make up the Organisation for Economic Cooperation and Development (OECD) slowed in October, mainly as a result of lower energy and food prices. Inflation in the economic bloc eased to 2.2 per cent in October from 2.3 per cent in September, data from the OECD showed.
In the meantime, core inflation, that is excluding food and energy, rose slightly to 1.9 per cent from 1.8 per cent a month earlier. Energy price growth softened to 5.8 per cent from 7.7 per cent in September. Likewise, food price inflation slowed marginally to 1.8 per cent from 1.9 per cent in September.
Among individual OECD members, inflation weakened in the US, Canada, Germany and Japan. At the same time, the rate was stable in the UK and France. The eurozone experienced an easing in inflation.
This report was compiled by Bank of Valletta for general information purposes only.