Emerging economies are no longer expanding at the rapid rates recorded before the onset of the global financial crisis. Nor have they been able to replicate the pace seen in late-2009 and early-2010 during the early post-crisis bounce. Still, despite the relative weakness, there is no indication of any imminent descent into recession: consistently over 50, the index remains well above the traumatic levels recorded in 2008 and the first half of 2009.
In relative terms, however, the emerging market story remains disappointing, at least compared with the US and the UK, where recent equivalent business surveys have been in the high 50s and, on some occasions, in the low 60s. Even the Eurozone, held back by a very soft performance by France, appears currently to be doing a bit better than the emerging world.
The HSBC Emerging Markets Index (EMI), a monthly indicator derived from the PMI™ surveys, signalled overall growth of output across global emerging markets in December. But the EMI fell to 51.6, from 52.1 in
November, signalling a weaker rate of expansion.
Manufacturing output continued to rise at a faster pace than services activity, and the rate of growth was only fractionally weaker than November‟s eight-month high. Meanwhile, service sector output rose at the slowest rate in three months.
Goods output growth was broad-based across the economies covered at the end of 2013, with the strongest expansions indicated in Taiwan, the Czech Republic and Turkey. Chinese manufacturing output growth eased from November‟s eight-month high.
New business inflows in global emerging markets rose for the fifth month running, albeit at the weakest rate since September. Backlogs continued to expand marginally, in line with the broad trend shown throughout the fourth quarter.
Inflationary pressures in emerging markets remained muted in the final month of 2013, with average input prices rising at the slowest pace since July. This led to the weakest increase in output prices in the current five-month sequence of inflation.