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.
Ariane Curtis Global Economist
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Global Trade Monitor

Trade rebound chimes with better news on supply chains

After gradually trending lower for much of last year, November marked the second consecutive month of strong growth in world trade, which reached a new record high. This adds to evidence that some product shortages began to ease towards the end of 2021. Even so, it will be well into 2022 at least before shipping bottlenecks improve materially. In the meantime, freight rates are likely to remain elevated.

26 January 2022

Global Economic Outlook

Growth to disappoint, but rates will rise regardless

Global growth will be slower this year than last and we expect outturns in major economies including the US and China to be below consensus forecasts. The US economy will be hindered by persistent labour shortages and reduced policy support while China will suffer from a slowdown in export growth and further weakness in the construction sector. Headline inflation is very likely to fall, but we expect core inflation to remain elevated across the developed world as shortages persist and wage growth picks up. Accordingly, most central banks are set to raise interest rates, although China will be a notable exception.

25 January 2022

Global Economics Update

PMIs: Omicron hit worse in the US than other DMs

The Flash PMIs for January suggest that Omicron has dealt a big blow to both industry and services sectors in the US in recent weeks, while other DMs have got off more lightly. But with new cases falling in several DMs, we think the economic hit will prove short-lived and will be mostly made up for in the months ahead.

24 January 2022

More from Ariane Curtis

Global Trade Monitor

Supply constraints cause world trade to trend lower

World trade has continued to edge down from its high peak in March, as supply shortages have meant that Asian exporters remain unable to keep up with strong demand from consumers in advanced economies. Even when demand does eventually abate, large backlogs of unmet orders mean that Asian exports will remain elevated, which should keep shipping and air freight costs sky-high for some time.

25 November 2021

Global Economics Update

PMIs: Shortages exert further upward pressure on prices

The Flash PMIs for November showed that although there are tentative signs that supply shortages are easing slightly, labour and product shortages are still weighing on recoveries in advanced economies. At the same time, the surveys point to record gains in prices in both the US and euro-zone.

23 November 2021

Global Economics Update

Auto sector past its worst, but slow recovery ahead

The slump in auto production related to supply chain disruptions has dragged down the pace of the global recovery this year. And while there have been some indications that supply of auto parts is starting to pick up again, meaning there is scope for an initial strong rebound in production as factories reopen, the overall recovery in output is still likely to be relatively slow. Pent-up demand for new vehicles suggests that there will also be a rebound in auto sales as supply improves, but prices have also soared in the US, which may rein in demand there.

19 November 2021
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