PMIs: Services left to do the heavy lifting

The flash PMIs for October brought news of an encouraging start to Q4 for services sector activity, alongside yet more evidence that shortages are holding back growth in industry and stoking even stronger price pressures. If it wasn’t clear already, inflation is going to stay higher for longer in the US and Europe.
Simon MacAdam Senior Global Economist
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Will labour shortages spur productivity gains?

One possible upside of the current labour market shortages in developed economies is that they could push firms towards expanding output by raising investment and productivity instead of relying on cheap labour. However, any gains in productivity may not materialise quickly enough to prevent central banks from reacting to the pick-up in wage growth. In view of the wider interest, we have also made this Global Economics Focus available to clients of our Long Run Service.

2 December 2021

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PMIs show some signs of supply shortages easing

November’s manufacturing PMIs suggest that global industrial production has continued to expand, albeit at a slower pace than earlier this year. There are tentative signs that supply disruptions may be easing, but from a very strained starting point, and virus developments may cause a renewed deterioration soon.

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Renewed restrictions: inflationary or disinflationary?

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PMIs: More signs of supply crimping industrial recovery

The key message from today’s batch of PMIs for September is that supply constraints are still limiting growth in industry, and there is little to suggest they will ease materially any time soon. So, manufacturers and wholesalers will continue to face higher costs, raising the chances of inflation staying higher for longer.

1 October 2021

Global Trade Monitor

More signs that the trade recovery has reached its limits

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Global Economics Update

Thinking through how we could be wrong on Evergrande

If, contrary to our opinion and the consensus, a collapse of Evergrande ends up having a significant impact on the rest of the world, it will be because it first causes either major financial dislocation within China or a property-led slump in China’s economy. The latter is probably the bigger risk for the global recovery. In view of the wider interest, we are also sending this Global Economics Update to clients of our Emerging Markets Service.

Drop-In: Evergrande – What are the risks to China and the world? Chief Asia Economist Mark Williams and Senior China Economist Julian Evans-Pritchard will be joined by Senior Markets Economist Oliver Jones to take your questions about the Evergrande situation. They’ll be covering the implications of collapse for China’s financial system and growth outlook, and assessing the global markets fallout. Register here for the 0900 BST/1600 HKT session on Thursday, 23rd September.

22 September 2021
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