02252020Tue
Last updateTue, 25 Feb 2020 5pm

Global Manufacturing Marginally Expands in December

The J.P. Morgan Global Manufacturing PMI fell to 50.1 in December, from 50.3 in November, to remain just above the 50.0 waterline that separates expansion from contraction. Growth of production and new orders were both marginal, as weak international trade flows stymied hopes of a stronger recovery from the mid-year downturn in the sector. Subdued business confidence led to cutbacks in staffing, purchasing and inventory holdings.


CEO Confidence Rebounded in Fourth Quarter

The Conference Board Measure of CEO Confidence, which declined to 34 in the third quarter of 2019, rebounded to a reading of 43 in the fourth quarter. A reading of more than 50 points reflects more positive than negative responses.

CEOs are less pessimistic about current economic conditions, with 15% saying conditions are better compared to six months ago, up from just 8% last quarter. Now, 52% say conditions are worse, down from 73% in Q3. CEOs are also more positive about current conditions in their own industries. Currently, 25% say conditions are better compared to six months ago, up from about 15% last quarter. Regarding conditions in their own industry, about 42% say conditions are worse, down from 63% last quarter.

USMCA Could Pass Senate by Week’s End

“White House trade adviser Peter Navarro predicted Sunday that the U.S.-Mexico-Canada Agreement (USMCA) will pass the Senate as early as Friday,” writes The Hill.

“He said on Fox News' "Sunday Morning Futures" that Sen. Chuck Grassley (R-Iowa) will mark up the long-awaited trade deal Tuesday in the Senate Finance Committee. Then Senate Majority Leader Mitch McConnell (R-Ky.) will be able to call it on the floor. With fast-track legislation there is a maximum of 20 hours before the vote.”

ISM: Manufacturing Contracts for Fifth Straight Month

Manufacturing contracted for the fifth straight month in December, as the PMI registered 47.2%, a decrease of 0.9% from the November reading of 48.1%. A number under 50% indicates contraction.

"Global trade remains the most significant cross-industry issue, but there are signs that several industry sectors will improve as a result of the phase-one trade agreement between the U.S. and China," says Timothy R. Fiore, chair of the Institute for Supply Management (ISM) Manufacturing Business Survey Committee.

Durable Goods Orders Down 2.0% in November

New orders for manufactured durable goods in November decreased $5.0 billion or 2.0% to $242.6 billion, the U.S. Department of Commerce announced. This decrease, down two of the last three months, followed a 0.2% October increase. Excluding transportation, new orders were virtually unchanged. Excluding defense, new orders increased 0.8%.

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