PMIs, Bank of Japan Tankan, New Quarter, and Easter Monday
April 1, 2024
Almost all European markets remain closed today for Easter Monday, a holiday of particular sentimental value to yours truly because it marks the 49th anniversary of my first day working in the New York Fed’s foreign department. Europe’s custom of extending the Easter break past the weekend tends to mute currency market trading and the flow of international data, but not this time. Being the first day of a new month (and calendar quarter), a number of purchasing managers surveys for the manufacturing sector have been reported. The Bank of Japan’s quarterly Tankan survey of corporate conditions and expectations also got released, and so did some inflation indicators.
In addition to most of Europe, markets were shut today in Australia, New Zealand, and Hong Kong. European exceptions include Serbia and Russia, where equities are currently down 0.6% and up 0.9%, respectively. The United States is also open for trading, and there the DJIA has dropped by 0.6%, but the SPX and Nasdaq indices are only marginally down. Japan’s Nikkei-225 index closed 1.4% lower, and share prices fell by 1.2% in Indonesia, 0.5% in Pakistan, and 0.4% in Taiwan. China’s Shanghai Composite climbed 1.2%, however.
Gold touched a record high earlier today of $2,265.3 per ounce and is currently 0.8% above its end-1Q level. West Texas Intermediate oil is 0.6% firmer, but Bitcoin fell 3.0% overnight following a stellar performance last quarter.
The dollar began this new quarter on its front foot, rising 0.4% according to the weighted DXY indexd. The greenback is up 0.5% against the euro and sterling, 0.4% higher versus the Swiss franc and Aussie dollar, and +0.3% relative to the yen and Canadian dollar.
The 10-year U.S. Treasury yield advanced 11 basis points overnight back to 4.31%. It’s Japanese counterpart edged up one basis point.
Among those manufacturing purchasing manager surveys reported today,
- Japan‘s March index was unrevised from its preliminary estimate of 48.2, which constitutes a 4-month high.
- Lower readings were reported for Thailand (an 8-month low of 49.1); South Korea (a 5-month low of 49.8); Turkey and the Philippines (2-month lows of 50.0 and 50.9)); Malaysia and Vietnam (3-month lows of 48.6 and 49.9, respectively).
- China’s privately compiled manufacturing PMI improved to a 13-month high of 51.1. NBS government-compiled PMI indices of 50.8 in manufacturing and 53.0 in non-manufacturing reflected the fastest growth in one year and 9 months, respectfully.
- Canada’s manufacturing PMI edged up 0.1 point to an 11-month high, but stayed just shy of the 50 no change line at 49.8.
- Brazil‘s manufacturing PMI fell to a 2-month low of 53.6.
- Greece‘s PMI rose 1.2 points to a 25-month high of 56.9.
- Russian manufacturing was surprisingly robust, rising a full point to a 211-month peak of 55.7 and associated with the most upbeat mood about the future in five years.
- Taiwan‘s PMI advanced to a 9-month high of 49.3.
- The U.S. Global S&P manufacturing PMI was revised 0.6 points lower to a 2-month low of 51.9.
- The U.S. ISM-compiled purchasing managers index easily beat market expectations with a reading of 50.3, highest in two years but associated with a 20-month high in the survey’s inflation index.
U.S. construction spending unexpectedly posted a second consecutive monthly decline in February of 0.3% following -0.2% in January,
This quarter’s Bank of Japan Tankan surveyed a total of 9,118 firms. The diffusion index among large manufacturers dipped two points to a 2-quarter low of +11, and respondents predict a further tiny drop this coming quarter. The diffusion index for large non-manufacturers rose two points to a 7-quarter high of +34 but is projected lower three months from now. Planned business investment for all firms in the coming fiscal year that begins today is expected to be only about a third as rapid as occurred last fiscal year.
Consumer price inflation in Indonesia rose to a 7-month high in March but at 3.05% remained within Bank Indonesia’s comfort zone.
In two economies with higher-than-average inflation — Pakistan and Kazakhstan — inflation of 20.7% and 9.1% in March represented their lowest 12-month advances in 22 and 23 months, respectively.
Copyright 2024, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
Tags: Bank of Japan Tankan, manufacturing purchasing manager indices
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