Dramatic Convergence of U.S. and Eurozone Activity Extended in March
April 7, 2015
The purchasing manager survey differentials for both services and manufacturing between the United States and eurozone have converged in each of the past five months, causing the sum of the two spreads, shown in the right-most column below to plunge from +15.2 points last November to only +1.6 points in March. This monthly feature on this website does not exactly compare oranges to oranges. For the U.S., indices compiled by the Institute of Supply Management are used, but for Euroland the indices are ones produced by Markit Economics even though that shop also calculates a U.S. PMI. There are two reasons for using the ISM index in the case of the U.S.: 1) the ISM data have a much longer history in backdata and 2) the ISM series has greater name recognition among investors who follow U.S. trends.
Since November, the U.S. services and manufacturing PMI indices have dropped by 2.3 and 6.1 points. The Ezone PMIs, in contrast, have risen by 3.1 and 2.1 points.
Between February and March, the U.S. non-manufacturing PMI fell by 0.4 points due primarily to a 1.9-point decline in production. Euroland’s PMI in services went up 0.5 points last month, propelled by a 1.7-point jump in the German economy’s score. The U.S. index was at a 3-month low in March, while the eurozone service PMI ascended to a 46-month high.
PMIs | U.S. | Ezone | U.S. | Ezone | Sum of | ||
Services | Services | Spread | Mf’g | Mf’g | Spread | Spreads | |
Jan 2012 | 56.8 | 50.4 | +6.4 | 54.1 | 48.8 | +5.3 | +10.9 |
Feb | 56.1 | 48.8 | +7.3 | 51.9 | 49.0 | +2.9 | +10.2 |
March | 55.0 | 49.2 | +5.8 | 53.3 | 47.7 | +5.6 | +11.4 |
April | 53.7 | 46.9 | +6.8 | 54.1 | 45.9 | +8.2 | +15.0 |
May | 54.1 | 46.7 | +7.4 | 52.5 | 45.1 | +7.4 | +14.8 |
June | 52.7 | 47.1 | +5.6 | 50.2 | 45.1 | +5.1 | +10.7 |
July | 52.9 | 47.9 | +5.0 | 50.5 | 44.0 | +6.5 | +11.5 |
August | 54.3 | 47.2 | +7.1 | 50.7 | 45.1 | +5.6 | +12.7 |
Sept | 55.2 | 46.1 | +9.1 | 51.6 | 46.1 | +5.5 | +14.6 |
October | 54.8 | 46.0 | +8.8 | 51.7 | 45.4 | +6.3 | +15.1 |
November | 54.8 | 46.7 | +8.1 | 49.9 | 46.2 | +3.7 | +11.8 |
December | 55.7 | 47.8 | +7.9 | 50.2 | 46.1 | +4.1 | +12.0 |
Jan 2013 | 55.2 | 48.6 | +6.6 | 53.1 | 47.9 | +5.2 | +11.8 |
February | 54.8 | 47.9 | +8.1 | 53.1 | 47.9 | +5.2 | +13.3 |
March | 54.5 | 46.4 | +8.1 | 51.5 | 46.8 | +4.7 | +12.8 |
April | 53.8 | 47.0 | +6.8 | 50.0 | 46.7 | +3.3 | +10.1 |
May | 54.0 | 47.2 | +6.8 | 50.0 | 48.3 | +1.7 | +8.5 |
June | 53.4 | 48.3 | +5.1 | 52.5 | 48.8 | +3.7 | +8.8 |
July | 55.9 | 49.8 | +6.1 | 54.9 | 50.3 | +4.6 | +10.7 |
August | 57.9 | 50.7 | +7.2 | 56.3 | 51.4 | +4.9 | +12.1 |
Sept | 54.5 | 52.2 | +2.3 | 56.0 | 51.1 | +4.9 | +7.2 |
October | 55.1 | 51.6 | +3.5 | 56.6 | 51.3 | +5.3 | +8.8 |
November | 54.1 | 51.2 | +2.9 | 57.0 | 51.6 | +5.4 | +8.3 |
December | 53.0 | 51.0 | +2.0 | 56.5 | 52.7 | +3.8 | +5.8 |
Jan 2014 | 54.0 | 51.6 | +2.4 | 51.3 | 54.0 | -2.7 | -0.3 |
February | 52.5 | 52.6 | -0.1 | 54.3 | 53.2 | +1.1 | +1.0 |
March | 53.7 | 52.1 | +1.6 | 54.4 | 53.0 | +1.4 | +3.0 |
April | 55.3 | 53.1 | +2.2 | 55.3 | 53.4 | +1.9 | +4.1 |
May | 56.1 | 53.2 | +2.9 | 55.6 | 52.2 | +3.4 | +6.3 |
June | 56.3 | 52.8 | +3.5 | 55.7 | 51.8 | +3.9 | +7.4 |
July | 57.9 | 54.2 | +3.7 | 56.4 | 51.8 | +4.6 | +8.3 |
August | 58.6 | 53.1 | +5.5 | 58.1 | 50.7 | +7.4 | +12.9 |
Sept | 58.1 | 52.4 | +5.7 | 56.1 | 50.3 | +5.8 | +11.5 |
October | 56.9 | 52.1 | +4.8 | 57.9 | 50.6 | +7.3 | +12.1 |
November | 58.8 | 51.1 | +7.7 | 57.6 | 50.1 | +7.5 | +15.2 |
December | 56.5 | 51.6 | +4.9 | 55.1 | 50.6 | +4.5 | +9.4 |
Jan 2015 | 56.7 | 52.7 | +4.0 | 53.5 | 51.0 | +2.5 | +6.5 |
February | 56.9 | 53.7 | +3.2 | 52.9 | 51.0 | +1.9 | +5.1 |
March | 56.5 | 54.2 | +2.3 | 51.5 | 52.2 | -0.7 | +1.6 |
Copyright 2015, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
Tags: non-manufacturing PMIs