U.S. Minus Ezone Factory PMI Spread Widened Last Month

January 2, 2013

The U.S. manufacturing purchasing managers index increased 1.2 points to 50.7 in December despite a 1.1-point drop in the production sub-index and an unchanged reading in new orders.  December’s score the third reading in the past four months to be above the no-change threshold of 50.0.  In June, July and August, by contrast, the PMI had been lower than 50.  The euro area PMI edged down a tenth point to 46.1 last month and was lower than 50.0 for a seventeenth time in a row.  The nadir during that span was a reading of 44.0 in July.  The quarterly average in 4Q of 45.9 indicated a slower pace of contraction than in the third quarter when the mean PMI was 45.1.

Substantially better U.S. readings for jobs of 52.7 after 48.4 and for supplier deliveries of 54.7 after 50.3 accounted for the improved U.S. report in December.

Within Euroland, results were mixed.  The indices for Austria (down 1.2 points to 48.1), Germany (off 0.8 points to 46.0), Spain (down 0.7 points to 44.6) and Greece (off 0.4 points to 41.4) produced greater rates of contraction, and Ireland’s 51.4 reading after 52.4 in November connoted a slower expansion rate.  However, the PMI scores in the Netherlands (+1.4 points at 49.6), Italy (up 1.6 points to 46.7), and France (+0.1 of a point to 44.6) signaled slower declines and thus no further intensification of the regional recession.

The euro rose three U.S. cents on average in December, posting its strongest quarterly mean since April.  The differential between the U.S. and Ezone manufacturing PMIs peaked that month at +8.9 points.  It was at 4.6 points in December, up from +3.3 in November but still below the width of 6.1 points registered in October.

Mfg PMIs U.S. Euroland Spread EUR/USD
Feb 2008 47.6 52.3 -4.7 1.475
March 48.3 52.0 -3.7 1.553
April 48.8 50.7 -1.9 1.574
May 49.8 50.6 -0.8 1.555
June 50.0 49.2 +0.8 1.557
July 49.2 47.4 +1.8 1.577
August 44.8 47.6 -2.8 1.497
September 44.8 45.0 -0.2 1.437
October 38.9 41.1 -2.2 1.331
November 36.5 35.6 +0.9 1.268
December 33.1 33.9 -0.8 1.351
Jan 2009 34.9 34.4 +0.5 1.326
February 35.6 33.5 +2.1 1.303
March 36.0 33.9 +2.1 1.306
April 39.8 36.8 +3.0 1.318
May 42.0 40.7 +1.3 1.365
June 45.8 42.6 +3.2 1.401
July 49.2 46.3 +2.9 1.409
August 53.5 48.2 +5.3 1.426
September 54.2 49.3 +4.9 1.455
October 53.9 50.7 +3.2 1.489
November 54.3 51.2 +3.1 1.491
December 55.8 51.6 +4.2 1.459
Jan 2010 56.7 52.4 +4.3 1.409
February 55.8 54.2 +3.6 1.368
March 59.3 56.6 +2.7 1.356
April 59.0 57.6 +1.4 1.342
May 58.8 55.8 +3.0 1.255
June 56.0 55.6 +0.4 1.220
July 55.7 56.7 -1.0 1.278
August 57.4 55.1 +2.3 1.288
September 56.4 53.7 +2.7 1.308
October 57.0 54.6 +2.4 1.389
November 58.0 55.3 +2.7 1.368
December 57.3 57.1 +0.2 1.323
Jan 2011 59.9 57.3 +2.6 1.337
February 59.8 59.0 +0.8 1.365
March 59.7 57.5 + 1.7 1.400
April 59.7 58.0 +1.7 1.445
May 54.2 54.6 -0.4 1.433
June 55.8 52.0 +3.8 1.438
July 51.4 50.4 +1.0 1.423
August 52.5 49.0 +3.5 1.435
September 52.5 48.5 +4.0 1.377
October 51.8 47.1 +4.7 1.371
November 52.2 46.4 +5.8 1.356
December 53.1 46.9 +6.2 1.316
January 54.1 48.8 +5.3 1.290
February 52.4 49.0 +3.4 1.323
March 53.4 47.7 +5.7 1.320
April 54.8 45.9 +8.9 1.315
May 53.5 45.1 +8.4 1.280
June 49.7 45.1 +4.6 1.254
July 49.8 44.0 +5.8 1.230
August 49.6 45.1 +4.5 1.255
September 51.5 46.1 +5.4 1.286
October 51.7 45.4 +6.1 1.297
November 49.5 46.2 +3.3 1.283
December 50.7 46.1 +4.6 1.313

Copyright 2013, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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