Manufacturing activity lost momentum in December.
Markit’s manufacturing PMI came in at 53.9, missing expectations for 54.0 but topping the flash reading of 53.7 earlier in December.
This is down from November’s reading of 54.8.
In addition to Markit’s report, the Institute for Supply Management’s latest manufacturing PMI also decline from November, coming in at 55.5 against 58.7 last month.
Expectations were for a reading of 57.5. The price paid component of ISM’s report also plunged in December, falling to 38.5 from 44.5 last month.
Markit’s reading showed the weakest overall improvement in the manufacturing sector since January 2014.
Any reading above 50 indicates expansion in manufacturing activity, while readings below that indicate contraction.
In its release, Markit said that the latest survey pointed to a solid rise in manufacturing output, but that the rate of expansion eased for the fourth month running to its least marked since January.
The report added that anecdotal evidence suggested that uncertainty towards the global economic outlook had contributed to slower production growth and softer new business gains during recent months.
Markit economist Chris Williamson said following the report, “The big question of course is whether the pace of expansion will continue to weaken as we move into 2015. Companies are citing greater uncertainty about the outlook, especially in export markets, leading to some scaling back of expansion plans and a greater reluctance for customers to place orders compared to earlier in the year, which suggests a slowdown could become more entrenched unless demand revives.”
Here’s the chart of the decline in Markit PMI over the last few months.
More to come …