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Economy in Brief

Markit MFG PMIs Turn Higher; Gains Are Widespread
by Robert Brusca September 3, 2009

The Markit PMIs turned higher in August. Across the main reporting Markit economics we find MFG PMIs are over the break-even mark of 50 in two of seven EU nations. Three others have readings with a ‘49’ handle. Italy back-slid in August and has the second weakest MFG reading at 44.24; Ireland’s MFG PMI rose this month but stands at a weaker level than Italy’s gauge, at 43.98. Still, all the countries in the table sport PMI readings that reside in the upper 50% of their range except Italy and Ireland. Country level readings are in the 60th percentile or better. Greece and France post the highest relative readings, in the 70th percentile of their respective ranges or better, For EMU the current reading is 48.24 and that stands in the 60th percentile, or in the top 40% of its range.

The services readings for August also show widespread improvement. The jump this month was very large for EMU and the gains for services spread across all major individually reporting countries in our six large-country sample.

With both manufacturing and the services sectors are making strong gains they are boosting the overall EMU composite index which moved up above the mark of 50, signaling growth. For its part, the OECD sees an end to the global recession. But it is warning of continued difficulties and strong head winds. The outlook has improved but the degree of improvement remains shrouded in caution. No agency is sticking its neck out to look for strong growth, even though most are now citing improvement and calls that say the recession is over are becoming commonplace

NTC/Markit MFG Indices
  Aug-09 Jul-09 Jun-09 3Mo 6Mo 12Mo Percentile
Euro-13 48.24 46.25 42.62 45.70 41.43 39.34 60.9%
Germany 49.17 45.65 40.88 45.23 40.51 38.81 62.5%
France 50.78 48.13 45.86 48.26 44.12 41.10 71.4%
Italy 44.25 45.36 42.69 44.10 40.87 39.24 42.2%
Spain 47.20 47.33 42.76 45.76 40.78 36.57 65.2%
Austria 49.95 46.46 42.01 46.14 41.73 40.07 65.4%
Greece 51.13 48.82 47.67 49.21 45.46 44.48 75.8%
Ireland 43.98 43.66 42.47 43.37 40.11 39.27 48.6%
UK 49.71 50.25 46.78 48.91 45.97 41.69 68.8%
percentile is over range since March 2000
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