Q4 off to a poor start globally.
The Global All-Industry Output Index – produced by JPMorgan and Markit in association with ISM and IFPSM – posted 51.3 in October, down from 52.4 in September. Following a brief spell of solid growth during the opening quarter of the year, the rate of expansion since
then has remained weak overall.
Manufacturing production declined for the fifth straight month in October, as manufacturers were hit by generally subdued domestic market conditions and declining international trade flows. Although growth continued in the service sector, the rate of increase eased from September’s six-month peak.
Although the US economy continued to expand at a solid clip, the rate of growth eased sharply to a two-month low. Russia and Ireland both maintained their periods of accelerated expansion, with the rates of increase in output hitting 30 and 20-month highs respectively. Growth was also recorded in China, India and Brazil.
Employment rose for the second time in the past three months during October. Service sector staffing levels increased following a slight reduction one month ago. In contrast, manufacturing employment fell and reversed the gains reported in September.
Signs of spare capacity remained at manufacturers and service providers in October, as highlighted by declines in backlogs of work in both sectors. The sharper reduction was signalled in manufacturing, where outstanding business was reduced at the joint-fastest pace since backlogs started to fall almost one-and-a-half years ago.
Average costs rose for the fourth month running in October. Service providers saw a substantial increase in average costs, with the rate of inflation close to September’s seven-month high. The increase was comparatively less sharp at manufacturers, despite ticking up to its highest since April this year.