U.S. Factory PMI Drops to 77-Month Low While Eurozone Counterpart Hits 19-Month High

December 1, 2015

A further sharp appreciation of the dollar against the euro in November was probably partly responsible for the divergent trends of the U.S. and Eurozone manufacturing purchasing manager indices.  The rightmost column below are monthly averages of the EUR/USD relationship. 

The U.S. PMI fell 1.5 points and was below the 50 no change level for the first time since November 2012.  The sub-indices for orders, production and prices respectively tumbled 4.0, 3.7 and 3.5 points between October and November.  Jobs, in contrast, rose 3.7 points.

Among members of Euroland, the PMI for Greece reached an 8-month high, and Italy‚Äôs reading was the best in four months.  The Spanish and German indices were at 3-month highs.  New business and production rose at the fastest pace in Euroland in a year and a half, while input prices continued to decline.  A weaker euro promotes demand for exports of manufactured goods and import-competing goods.

Mfg PMIs U.S. Euroland Spread EUR/USD
Jan 2013 53.1 47.9 +5.2 1.330
February 53.1 47.9 +5.2 1.334
March 51.5 46.8 +4.7 1.295
April 50.0 46.7 +3.3 1.301
May 50.0 48.3 +1.7 1.299
June 52.5 48.8 +3.7 1.319
July 54.9 50.3 +4.6 1.309
August 56.3 51.4 +4.9 1.331
September 56.0 51.1 +4.9 1.335
October 56.6 51.3 +5.3 1.364
November 57.0 51.6 +5.4 1.349
December 56.5 52.7 +3.8 1.370
Jan 2014 51.3 54.0 -2.7 1.361
February 54.3 53.2 +1.1 1.366
March 54.4 53.0 +1.4 1.380
April 55.3 53.4 +1.9 1.380
May 55.6 52.2 +3.4 1.374
June 55.7 51.8 +3.9 1.360
July 56.4 51.8 +4.6 1.354
August 58.1 50.7 +7.4 1.332
September 56.1 50.3 +5.8 1.290
October 57.9 50.6 +7.3 1.268
November 57.6 50.1 +7.5 1.247
December 55.1 50.6 +4.5 1.232
Jan 2015 53.5 51.0 +2.5 1.162
February 52.9 51.0 +1.9 1.135
March 51.5 52.2 -0.7 1.083
April 51.5 52.0 -0.5 1.081
May 52.8 52.2 +0.6 1.116
June 53.5 52.5 +1.0 1.123
July 52.7 52.4 +0.3 1.101
August

September

October

51.1

50.2

50.1

52.3

52.0

52.3

-1.2

-1.8

-2.2

1.114

1.123

1.121

November 48.6 50.1 -4.2 1.076

Copyright 2015, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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