U.S. Advantage in Manufacturing Over Euro Area Held Generally Steady in June

July 1, 2009

 

Mf’g PMI’s United States Euroland Spread EUR/USD
Feb 2008 48.8 52.3 -3.5 1.475
March 49.0 52.0 -3.0 1.553
April 48.6 50.7 -2.1 1.574
May 49.3 50.6 -1.3 1.555
June 49.5 49.2 +0.3 1.557
July 49.5 47.4 +2.1 1.577
August 49.3 47.6 +1.7 1.497
September 43.4 45.0 -1.6 1.437
October 38.7 41.1 -2.4 1.331
November 36.6 35.6 +1.0 1.268
December 32.9 33.9 -1.0 1.351
Jan 2009 35.6 34.4 +1.2 1.326
Feb 2009 35.8 33.5 +2.3 1.303
Mar 2009 36.3 33.9 +2.4 1.306
Apr 2009 40.1 36.8 +3.3 1.318
May 2009 42.8 40.7 +2.1 1.365
Jun 2009 44.8 42.6 +2.2 1.401

 

The rates of factory sector contraction slowed in tandem last month in the United States and Euroland.  Readings below 50 connote contracting activity.  The closer the result is to 50, the more gentle is the rate of contraction.  Except in April, the spread between the U.S. reading and Euroland’s has hovered between 2.0 points in June and 2.4 points in March since mid-winter.  The Euroland sub-component scores for production and export orders were their highest in June since August 2008.  Since February, however, the euro has risen from $1.30 to $1.40.  After the euro previously had also ranged above $1.40 in early 2008, Euroland relinquished its factory-sector advantage to the United States.  It would not be surprising to see the spread that now favors the United States increase anew in the months ahead.

Copyright Larry Greenberg 2009.  All rights reserved.  No secondary distribution without express permission.

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