ECONOMICS COMMENTARY — Jun 10, 2024
Monthly PMI Bulletin: June 2024
By Jingyi Pan
The following is an extract from S&P Global Market Intelligence's latest Monthly PMI Bulletin. For the full report, please click on the 'Download Full Report' link.
Global PMI indicates fastest growth in 12 months amid rising inflation
The global economic expansion accelerated to the fastest pace in 12 months midway through the second quarter, supported by improvements in both manufacturing and service sector output. Selling price inflation remained elevated, however, as cost pressures rose.
The J.P.Morgan Global PMI Composite Output Index - produced by S&P Global - rose to 53.7 in May from 52.4 in April. Historical comparisons indicate that the PMI is broadly indicative of the global economy growing at an annualized rate of 3.4% in May. The latest acceleration in global growth was driven by improvements in both the manufacturing and service sectors, where output rose at the fastest rates in 29 and 12 months respectively. Furthermore, improvements were broad based by region, as both developed and emerging market activity increased at rates that were solid and faster than in April.
Further to indications of better output performance, May PMI data also revealed that forward-looking indicators, such as the new orders and future output indices, have ticked higher to hint at growth being sustaining in the near-term.
That said, price pressures lifted higher in May. The pace at which average global selling prices rose in May increased slightly from April amid the joint-fastest rise in average input costs. This signalled that inflation is still elevated and is indicative of global consumer price inflation averaging 3.5% in the latest survey period. Given the uncertainty surrounding monetary policy outlooks around the world, the latest data meant that the fight against inflation is still not over and we will continue to track upcoming flash PMI figures due June 21 for further insights on where the data are leading us.
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Purchasing Managers' Index™ (PMI®) data are compiled by S&P Global for more than 40 economies worldwide. The monthly data are derived from surveys of senior executives at private sector companies, and are available only via subscription. The PMI dataset features a headline number, which indicates the overall health of an economy, and sub-indices, which provide insights into other key economic drivers such as GDP, inflation, exports, capacity utilization, employment and inventories. The PMI data are used by financial and corporate professionals to better understand where economies and markets are headed, and to uncover opportunities.
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