The global manufacturing sector faced continued contraction in October, marking the fourth consecutive month of decline as the industry grapples with reduced new orders, job losses, and strained supply chains.
The latest JP Morgan Global Manufacturing PMI report, produced in partnership with S&P Global Market Intelligence, ISM, and IFPSM, recorded a composite index of 49.4, up slightly from September’s 48.7 but still under the neutral 50.0 mark, signalling a sustained downturn.
October’s report indicated that three of the PMI’s five main components – new orders, employment, and stocks of purchases – remained in negative territory, contributing to the ongoing contraction.
Although manufacturing output held steady at September levels, widespread supply chain disruptions continued to affect global operations, with delivery times lengthening further, particularly in North America and parts of Asia.
The moderation in the PMI score, however, suggested a slight easing in the rate of contraction. Notably, China showed signs of improved operating conditions, while declines in the US and the euro area slowed.
India, Spain, and Brazil led in manufacturing growth, while Austria, Germany, and France experienced sharper contractions.
Sector-wise, intermediate and investment goods industries reported worsening conditions, though the pace of decline slowed. The consumer goods sector saw a contrasting improvement, with expansion at its strongest rate in four months.
Global demand continued to struggle, with new business intake declining for the fourth consecutive month, particularly in the intermediate and investment goods industries.
The trend in export demand remained weak, with international orders dropping for the fifth month in a row.
Major manufacturing regions, including China, the US, the euro area, Japan, and the UK, all reported declining export volumes, pointing to faltering global trade dynamics.
October’s subdued performance weighed heavily on business sentiment, which hovered near September’s 22-month low.
Employment levels declined across various regions, including China, the U.S., and the euro area, marking the steepest rate of job losses since August 2020.
However, some regions, such as Canada, the U.K., India, and Brazil, managed to buck the trend with modest job growth.
On the pricing front, input cost inflation remained steady at September’s six-month low. Although output charges increased slightly in October, the rate of growth was uneven, with emerging markets generally seeing faster inflation than developed nations.
Both developed and emerging markets experienced prolonged supplier delays, with average delivery times stretching to their highest since December 2022.
