Economy in Brief

The standard and Poor’s composite Global PMIs for September showed broad weakness in the month compared to August. Only 7 reporters in the table showed improvement month-to-month while 12 showed deterioration. The average unweighted PMI value for September was 51.0 compared to 50.6 in August which surprisingly indicates an improvement. However, the median value showed a level of 50.0 in September compared to 50.4 in August, revealing deterioration. The breadth of comparison show a lot more weakness month-to-month than strength; however, the average and median data are at odds on what's happening on balance.

Compared to July the median data also showed that the September value was weaker; on average data, however, September is stronger compared to July. But both cases were dealing with rather small margins of change.

The sequential comparisons over three months, six months and 12 months chronicled in the table show all three horizons tilted toward improvement- even for the 3-month span in the face of the September broad deterioration. Median averages for each period are slightly weaker than average values but both comparisons show similar small improvements in the 3-month average compared to the 12-month average.

However, the average and mean value for the while span of data back to January 2021 are nearly identical and the ranking of the current September observations in that data is similar with a 54.5 percentile standing using the average of all rank standings on the period while the median of composite standings is at 52.6 percentile. Over the period, the rank standings show fourteen of nineteen observations are above the 50% mark putting them above the median for the period. Only five countries have composite PMIs below their median values since 2021. The laggards are Poland, Greece, Switzerland, the United Kingdom, and Norway. India has a ranking in its 98th percentile, but apart from that Slovenia has a 77th percentile ranking and the next tranche of rankings is in the sixtieth percentile encompassing Germany, Belgium, the Netherlands, the Czech Republic, Australia, and China. There are also four reporters with rankings above 50% but below 51%! These are France, Italy, Spain, and Hungary.

In comparisons, the high-low range rankings show countries generally much closer to their lower bound than their upper bound on the period, with Slovenia, Australia, India, and China as exceptions to this phenomenon.

The September data are bit disconcerting. But then the changes in the month are generally small. The average and median data for this group of countries shows average and median PMI values at 50 or 51. Both approaches are close to showing no or small output changes overall. While there have been swings in national data since 2023, there has been little trending at all as economic output has been mostly weak and showing little acceleration or deceleration except for specific countries over very short periods. The clear overriding trend has been sideways and weak. And it remains so.

The unemployment rate in the European Monetary Union (EMU) ticked up to 6.3% in August from 6.2% in July, rising one tenth of one percentage point from its all-time low. Even though this is an increase in the unemployment rate, it's a very small increase and it's an unemployment rate that is extremely low for the EMU. The unemployment rate is based on the 20 economies that report unemployment. However, the table reports 12-early reporters and long-standing EMU members that show that the unemployment rate increased in only five countries in August: Austria, Finland, Italy, Portugal, and the Netherlands. All the other countries listed in the table say their unemployment rates were either steady or lower on the month. In July, the unemployment rate rose month-to-month in only one country, which was Ireland where it went up to 4.8% from 4.6%. In June, the unemployment rate rose in only three countries: Austria, Finland, and Greece. Of course, the table is only a sample of countries; there are 20 countries that typically contribute data to the European Monetary Union aggregate. The full slate of data is represented in the EMU total as reported.

Sequential data that look at changes in unemployment rates over three months, six months and 12 months, show that among these 12 member countries over 3 months only four had unemployment rates increasing; over 6 months five countries had unemployment rates increasing; over 12 months seven countries have their unemployment rates higher.

When we take the reported unemployment rates as of August and put them in a queue of data back to the year 2000, there are only three countries in the monetary union that have unemployment rates that are above their median for that period. And those are Austria, Luxembourg, and Finland. All the rest of the countries have unemployment rates that rank below their 50th percentile which places them below their respective medians for that period.

In fact, apart from the three countries that have their unemployment rates above their respective medians, the rest (the remaining nine) rank in their bottom 25th percentiles. All of the highest-ranking unemployment rates among those nine are Ireland at the 23rd percentile, and Germany and Portugal at the 22nd percentile. Italy, for example, still has an unemployment rate that ranks at its 0.7 percentile. Greece's unemployment rate, even though it's 8.1%, has been lower only 3.3% of the time. The unemployment rate for the entire monetary union has been lower only 3.2% of the time. If we look at the broader unemployment rate for the European Union, it has been lower only 2.6% of the time.