U.S. Minus Euroland PMI-Mf’g Spread Widened to 3.0 Points in March
April 1, 2010
Manufacturing expanded robustly and at an accelerated pace last month in both Euroland and the United States. Euroland’s purchasing managers index advanced 2.4 points to 56.6, best since November 2006. The output and orders sub-indices hit their highest respective levels since June 2006 and June 2000. The United States managed to outperform Euroland’s stellar manufacturing numbers. The U.S. PMI advanced 3.1 points to 59.6, three points better than its Euroland counterpart and the best result since July 2004. The U.S. production and orders sub-indices surpassed the 60 level with gains of 2.7 points to 61.1 on the former and 2.0 points to 61.5 on the latter. The U.S. jobs index slid a point to a still respectable 55.1 value.
Within Euroland, manufacturing activity expanded in German (60.2), the Netherlands (57.8), France (56.3), Italy (53.7), Ireland (53.0) and even Spain (51.8), whose recession had persisted beyond end-2009. The March-on-February point increases in those countries were 3.0, 2.6, 1.6, 2.1, 4.4, and 2.7 points. The Greek debt crisis, however, depressed that economy’s index by a further 1.3 points to a deeply recessionary 42.9. Elsewhere in Europe, Britain’s factory PMI improved 0.7 points to 57.2, highest since October 1994, and the Swiss PMI shot up 8.1 points to 65.5. Sweden reported another above-60 score, this time of 61.1 after 61.5 in February and 61.7 in January.
The second quarter begins with evidence of considerable momentum in manufacturing on both sides of the Atlantic. Europe is benefiting from a more competitive euro, and such has not impaired the U.S. economy. EUR/USD quotes in the rightmost column below are monthly averages. The trade-weighted dollar remains near early-February levels, so U.S. exports also remain quite attractively priced. Both Europe and the United States are supported by a brisk rebound in emerging market demand, persistently loose monetary and fiscal policies, and better financial market functionality.
Mf’g PMI’s | U.S. | 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 |
February | 35.7 | 33.5 | +2.2 | 1.303 |
March | 36.4 | 33.9 | +2.5 | 1.306 |
April | 40.4 | 36.8 | +3.2 | 1.318 |
May | 43.2 | 40.7 | +2.5 | 1.365 |
June | 45.3 | 42.6 | +2.7 | 1.401 |
July | 49.1 | 46.3 | +2.8 | 1.409 |
August | 52.8 | 48.2 | +4.6 | 1.426 |
September | 52.4 | 49.3 | +3.1 | 1.455 |
October | 55.2 | 50.7 | +4.5 | 1.489 |
November | 53.7 | 51.2 | +2.5 | 1.491 |
December | 54.9 | 51.6 | +3.3 | 1.459 |
Jan 2010 | 58.4 | 52.4 | +6.0 | 1.409 |
February | 56.5 | 54.2 | +2.3 | 1.368 |
March | 59.6 | 56.6 | +3.0 | 1.356 |
Copyright Larry Greenberg 2010. All rights reserved. No secondary distribution without express permission.
Tags: Euroland, PMI, United States