Eurozone PMI Points Towards Recovery

Global PMIs and leading indicators point to a continued recovery led by Europe and China, whereas US signals have weakened slightly recently.

We look for the global recovery to continue at the current pace in Q4 with broadly unchanged growth rates in the US, China and euro area. In 2014 we expect US and eurozone growth to gather pace whereas Chinese growth is expected to moderate slightly.

US ISM is ‘too high’ relative to other indicators and we look for it to adjust lower in the coming months. PMI in the eurozone is expected to move sideways in the short term before rising a bit further in 2014. We look for Chinese HSBC PMI to rise slightly further in the short term before moderating again next year.


Global PMI new orders increased marginally to 53.2 in October from 52.8 in September. It points to continued growth close to trend for the global economy.

In the US, ISM was very strong in October, but most leading indicators suggest ISM is in for a decline in the coming months. This would also be better in line with continued soft growth in Q4 as most other indicators suggest.

In the eurozone flash PMI composite continues to point to continued recovery – although it fell slightly in October. OECD leading indicator, ZEW and ifo also confirm continued growth close to trend at 1.0-1.5%. UK data continues to be very strong. Scandiindicators trend higher amid some noise in recent data.

In China the activity data points to stronger activity in H2. Money growth suggests some slowing again during 2014. In Japan data continues to be strong as PMI reached a new cycle high and Tankan is rising. OECD leading indicator points to slower growth in 2014. PMIs for CEE countries point to a gradual recovery.

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