May PMI survey data shows global economy on course for strong second quarter

The PMI survey data indicates that the global economy is on course for a strong second quarter. The JPMorgan Global PMI, which is compiled by IHS Markit from its several national surveys, rose to 53.7 in May from April’s 53.6. The latest reading is widely in line with global GDP rising at an annual rate of 2.5 percent.

Europe continued to rule the PMI rankings. Out of the four largest developed world economies, euro area once again led the growth. The currency block has now led the pack for four consecutive months, followed by the U.K. Slower, but still comparatively strong, growths were observed in the U.S. and Japan, with both recorded more rapid paces of growth than April.

Looking at the major emerging nations, the main disappointment was the on-going marginal growth rate signalled by the Caixin PMI surveys for China, where manufacturing fell back into decline. Meanwhile, even if Brazil saw the weakest PMI, the surveys add to indications of an end to the nation’s deep recession, noted Markit.

One of the major alterations in the global PMI surveys came in the price data. Global factory input prices indicated the smallest rise since September 2016, implying that lower cost pressures might also feed through to consumer prices as retailers see pressure come off wholesale prices, added Markit.