London / Tokyo — According to a study released Wednesday, global factory activity accelerated in November, despite remaining supply bottlenecks, caps on production and rising raw material costs.
Towards the end of the month, the newly detected Omicron coronavirus mutant emerged as a new concern for policy makers who are already trying to recover the economy and curb inflation.
The November survey may not reflect the spread of variants that could put further pressure on the pandemic-confused supply chain, and many countries impose new border controls to block themselves. Did.
Samuel Toms of the Pantheon Macroeconomics said:
Nevertheless, IHS Markit’s Final Manufacturing Purchase Managers Index (PMI) in the euro area rose from 58.3 in October to 58.4 in November.
Supply chain issues have made it a market for raw material sellers, with input price indexes just below October’s record highs, and factories in the region pass on the fastest rising costs in the history of research to their customers. Did.
This suggests that the block-wide inflation rate on Tuesday was a record high of 4.9% last month, continuing to exceed the European Central Bank’s target of 2.0% and acting on banks. To urge.
In the UK outside the European Union and the euro area, more manufacturers than at any point in the last three decades reported rising costs last month, emphasizing pressure on the Bank of England to raise interest rates.
According to a November Reuters poll, the BoE will probably be the first major central bank to raise interest rates soon this month.
US central bankers will discuss in December whether to close bond purchases months earlier than expected, Federal Reserve Chair Jerome Powell said Tuesday.
Factory activity in China returned to contraction in November, and private Caixin / Markit Manufacturing PMI showed that sluggish demand and rising prices had hit manufacturers.
Private sector findings focusing on small and medium-sized businesses in coastal areas contrast with Tuesday’s official Chinese PMI survey, where manufacturing activity is at a very modest pace but unexpected in November. Ascended to.
Wang Zhe, senior economist at Caixin Insight Group, said in a statement accompanying the data release that “relaxation of supply-side constraints, especially the relaxation of the power crisis, has accelerated the pace of production recovery.”
“But demand was relatively weak and was constrained by the COVID-19 epidemic and rising product prices.”
However, outside of China, factory activity appeared to be recovering as PMI expanded in countries such as Japan, South Korea, India, Vietnam and the Philippines.
Japan’s PMI has risen to a high of nearly four years, while South Korea’s PMI has risen.
India’s manufacturing activity grew at the fastest pace in the 10 months of November, supported by a strong recovery in demand. Manufacturing activities in Taiwan continue to expand, and the situation is similar in Indonesia.
Jonathan Cable and Reika Kihara