Spread Between U.S. and Ezone Manufacturing PMIs at a 4-Year High

December 3, 2018

The point differential between the ISM-compiled U.S. manufacturing PMI and the IHS-compiled Euroland manufacturing purchasing managers index widened 1.8 points in November to 7.5, its greatest width since a similar spread in November 2014. This more sizable U.S. advantage happened in spite of a pricier dollar. With a large export-derived base, manufacturing prosperity tends to ebb when a currency appreciates, and the average euro value of the dollar last month was the highest since June of last year.

The U.S. manufacturing PMI rebounded 1.6% last month to a 2-month high of 59.3, powered mainly by a 4.7-point rise in orders and a 1.6-point advance in the jobs component of the index. The sub-index measuring pricing pressure, on the other hand, dived nearly 11 points between October and November.

Euroland’s manufacturing PMI fell 0.2 points to 51,8, indicating the slowest rate of improvement since August 2016. Ranked from fastest to slowest, individual Ezone member PMI readings ranged from a 25-month low of 56.1 in The Netherlands to 2-month highs of 54.9 in Austria and 55.4 in Ireland, a¬†6-month high of 54.0 in Greece, a 3-month high of 52.6 in Spain, a 31-month low of 51.8 in Germany, a 26-month low of 50.8 in France, and a 47-month low in Italy of 48.6. Being below 50, Italy’s score signifies that it alone saw an outright deterioration last month in the manufacturing sector.

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 53.3 51.0 +2.3 1.135
March 52.3 52.2 +0.1 1.083
April 51.6 52.0 -0.4 1.081
May 53.1 52.2 +0.9 1.116
June 53.1 52.5 +0.6 1.123
July 51.9 52.4 -0.5 1.101
August

September

October

51.0

50.0

49.4

52.3

52.0

52.3

-1.3

-2.0

-2.9

1.114

1.123

1.121

November

December

Jan 2016

February

March

April

May

June

July

August

September

October

November

December

Jan 2017

February

March

April

May

June

July

August

September

October

November

December

Jan 2018

February

March

April

May

June

July

August

September

October

November

48.4

48.0

48.2

49.7

51.7

50.7

51.0

52.8

52.8

49.4

51.7

52.0

53.5

54.5

56.0

57.6

56.8

55.3

55.5

56.7

56.5

59.3

60.2

58.5

58.2

59.3

59.1

60.8

59.3

57.3

58.7

60.2

58.1

61.3

59.8

57.7

59.3

52.8

53.2

52.3

51.2

51.6

51.7

51.5

52.8

52.0

51.7

52.6

53.5

53.7

54.9

55.2

55.4

56.2

56.7

57.0

57.4

56.6

57.4

58.1

58.5

60.1

60.6

59.6

58.6

56.6

56.2

55.5

54.9

55.1

54.6

53.2

52.0

51.8

 

 

-4.4

-4.8

-4.1

-1.5

+0.1

-1.0

-0.5

0.0

+0.8

-2.3

-0.9

-1.5

-0.2

-0.4

+0.8

+2.2

+0.6

-1.4

-1.5

-0.7

-0.1

+1.9

+2.1

0.0

-1.9

-1.3

-0.5

+2.2

+2.7

+1.1

+3.2

+5.3

+3.0

+6.7

+6.6

+5.7

+7.5

1.076

1.090

1.087

1.111

1.114

1.134

1.130

1.124

1.106

1.120

1.121

1.103

1.078

1.054

1.063

1.064

1.069

1.072

1.106

1.124

1.153

1.182

1.191

1.176

1.174

1.184

1.220

1.234

1.234

1.227

1.181

1.167

1.169

1.155

1.166

1.148

1.136

 


Copyright 2018, Larry Greenberg. All rights reserved. No secondary distribution without express permission.

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