NEW YORK: Global manufacturing activity stabilised last month, though difficulties in sourcing components persist and the sector must now grapple with the challenge posed by the omicron variant of the coronavirus.
In the euro area, where soaring inflation is adding to the renewed pandemic risks, the main factory gauge ended a 4-month slowdown from June’s record expansion to reach 58.4, according to a final IHS Markit survey of purchasing managers on Wednesday. But it warned that severe supply-related constraints continued to hinder operations across the region, report agencies.
Factories across South-east Asia had been on a recovery path as loosened movement restrictions allowed output to catch up before the crucial year-end holiday season.
Malaysia, Vietnam and the Philippines all saw rises in their PMIs, while Thailand’s saw a slight decline to 50.6, though still above the 50 reading that separates expansion from contraction. India’s PMI increased to 57.6 - the highest reading since January. In northern Asia, manufacturing activity in Taiwan and trade bellwether South Korea held in expansionary territory, while Japan’s PMI rose to 54.5, its highest since January 2018.
Meanwhile, separate data from South Korea out on Wednesday showed exports last month rose more than expected and are headed for an annual record, suggesting global trade is continuing to recover.
China’s official manufacturing PMI increased to 50.1, the first time in three months it exceed the 50 mark. The non-manufacturing gauge, which measures activity in the construction and services sectors, fell slightly to 52.3.
But it’s news of the latest Covid-19 variant, Omicron, that perhaps presents the biggest headwind. The new strain is seen as a potential threat to industrial production across the world after the Delta variant forced factories to shut and further snarled supply chains.